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COVID-19 provision takes toll on JM Financial, reports almost flat net at Rs 130.6 cr

PTI   

COVID-19 provision takes toll on JM Financial, reports almost flat net at Rs 130.6 cr
Mumbai, May 6 () JM Financial on Wednesday reported a marginal 1.5 per cent rise in consolidated net income to Rs 130.6 crore for the three months period to March on a 6.12 per cent growth in revenue.

The numbers would have been higher had it not been for a one-time provision of Rs 175 crore to deal with the uncertainties arising from COVID-19 pandemic, the company said in a statement.

The company reported a total revenue of Rs 840.58 crore in the reporting quarter, registering a growth of 6.12 per cent over the same period previous fiscal, it said.

For the full year, consolidated net profit declined 4.75 per cent to Rs 545 crore, while revenue slipped a marginal 1.3 per cent to Rs 3,453.55 crore.

The numbers have been hit as the asset quality suffered during the year, with gross bad loans more than doubling to 1.65 per cent of the total book, compared to 0.68 per cent in March 2019 and net non-performing assets also more than doubled to 1.13 per cent from 0.55 per cent.

The company said its SMA-2 (Special Mention Accounts) have increased from 0.73 per cent of the portfolio to 2.10 per cent of the portfolio during the quarter.

"The numbers take into consideration the impact of the pandemic and is captured in expected credit loss and fair value of investment. The group has taken gross provisions (including fair value loss) of Rs 175 crore on account of the COVID pandemic," the group's managing director Vishal Kampani said.

While the past 18 months have been challenging for NBFC sector due to the stressed credit environment and slowing growth, the situation further worsened with COVID-induced national lockdown, he explained.

Despite this, the company could maintain strong liquidity buffers and healthy leverage ratios that reflected in the cash/cash equivalent of Rs 3,412 crore as of end March and one of the lowest net debt-equity ratio of 1.04x, he added.

The AUM (assets under management)/AUA (assets under administration) of wealth management business rose to Rs 44,883 crore excluding custody assets, up from Rs 41,886 crore in March 2019 but lower than Rs 46,886 crore as of December 2019.

During the quarter, the average daily trading volume stood at Rs 13,894 crore.

The total mortgage lending book, including the loan book of JM Financial Credit Solutions and JM Financial Home Loans stood at Rs 7,651 crore.

As of end March, the consolidated loan book stood at Rs 11,530 crore, distressed credit business AUM at Rs 11,490 crore, wealth management AUM Rs 44,880 crore, and mutual fund AUM at Rs 6,110 crore.

In the run up to the earnings announcement, the JM Financial counter rallied 10 per cent to close at Rs 62.80 on the BSE, whose benchmark Sensex gained 0.74 per cent. BEN BAL


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