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L&T Finance Holdings Q3 net up 66% on healthy margins

L&T Finance Holdings posted a 66% growth in consolidated profit after tax for the third quarter ended December 31 at Rs 182 crore compared with the same period a year ago on the back of healthy margins, good fee income, well managed operating costs and optimization in borrowing costs.

The loans and advances grew by 20% year-on-year to Rs 45,225 crore. This has been aided by strong disbursement growth of 32% across business to consumer products which are tractors, two wheelers, housing and microfinance in the retail business and operational projects in renewable, roads and non-infrastructure segments in the wholesale business.

“It was a satisfactory quarter for us. We had healthy growth in assets, disbursement and profits during the quarter as well as nine month period,” said YM Deosthalee, chairman and managing director of the company.

The consolidated Net Interest Margin (NIM) at the end of the quarter stood at 5.66% compared with 5.23 per at the end of the quarter ended December, 2013. The gross NPA stood at 3.01% compared with 2.93% in the same period a year ago.

The company has continued to make additional provisions in the quarter increasing the provision coverage to 35% at the consolidated level. In line with the conservative provisioning policy the company carries Rs 190 crore of provisions in excess of Reserve Bank of India (RBI) norms.

In the retail and mid-market finance the fee income was at Rs 35 crore during the quarter compared with Rs 9 crore a year ago. In the wholesale finance business the fee income was at Rs 34 crore compared with Rs 2 crore in the same quarter a year ago.

The operating expenses for the retail and mid-market finance segments was at Rs 162 crore compared with Rs 134 crore in the same quarter a year ago. The operating expenses for the wholesale finance was Rs 29 crore during the quarter compared with Rs 22 crore a year ago.

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