Muthoot Finance Q3 net profit jumps 59% to Rs 464 cr

Muthoot Finance today reported 59 per cent jump in its consolidated net profit to Rs 464 crore for the third quarter ended December 31, the highest ever quarterly gains on increased demand for loans.

The company had made a net profit of Rs 291 crore during the corresponding quarter of 2016-17.

Total income grew by 16 per cent to Rs 1,567 crore during the quarter, as against Rs 1,346 crore in the same period last fiscal, the company said in a statement.

The loan asset size of Muthoot Finance stood at Rs 28,265 crore at the end of December quarter.

Chairman M G Geroge Muthoot said since this is the record quarterly profit, the company will give the highest ever dividend of 100 per cent or Rs 10 per equity share to the shareholders.

“The consolidated loan book of the group has increased by 10 per cent year-on-year at Rs 30,712 crore continuing with diversification activities,” he said.

“Our subsidiaries have again shown an excellent performance. We expect to grow our AUM by 10-12 per cent in this fiscal because of increased credit demand,” said George Alexander Muthoot, Managing Director of the company.

On asset front, gross non-performing assets (NPAs) or bad loans rose 5.62 per cent of the total loan extended as on December 31, 2017 from 2.92 per cent on the same date of 2016. Net NPAs also rose to 4.93 per cent against 2.54 per cent.

The company made provision of Rs 197.50 crore for bad loans for third quarter of 2017-18, up from Rs 101.90 crore in the year-ago period.

“The rise in NPA accounts is mainly on account of more time given to customers for repayment on our shorter tenor loans of 6 months which became NPA faster than our conventional loan tenor of 12 months.

The “company is currently maintaining increased standard asset provision of 1.25 per cent higher than the regulatory requirement of 0.35 per cent,” George A Muthoot said.

Shares of Muthoot Finance closed 7.38 per cent higher at Rs 432.35 per unit on BSE.