This Article is From Jan 23, 2015

Muthoot Q3 Profit Drops to Rs 154 Crore

Muthoot Q3 Profit Drops to Rs 154 Crore

Kochi: Muthoot Finance Ltd on Thursday reported a dip in its net profit to at Rs 154 crore for the third quarter that ended on December 31, 2014.

The Kerala-headquartered had registered a net profit of Rs 194 crore for the corresponding period of the previous fiscal year.

While the net profit for the nine months to December 31, 2014 was Rs 505 crore, the retail loan assests under management were Rs 22,088 crore. Total income for December 2014 quarter in FY15 was Rs 1,069 crore.

Muthoot chairman M G George Muthoot said the non-banking financial company could reverse its de-growth trend in the portfolio which prevailed the past few quarters.

"The footfalls of our customers is increasing and it is a positive sign," he said, adding that customers who had "burnt their fingers" are coming back and the flow towards the banks have stopped.

He said company continues its growth momentum with a growth in gold loan portfolio of Rs 315 crore during the quarter. Its net worth has crossed Rs 5,000 crore during the quarter.

Referring to the recent agreement with Yes Bank for acting as its business correspondent, he said initially focus will be on domestic remittances, especially the migrant population, which is quite big in India. Later on, they would move on to other banking activities like deposits, loans.

On the expectations from the Union budget, he said Muthoot had asked for a separate regulator for NBFCs, priority sector lending to get loans from banks and proposed reducing the minimum level of deposits from private players from Rs 25 lakh to Rs 5 lakh. The new government was looking at NBFCs "more sympathetically", he added.

He also said Muthoot had increased its equity shares holding in Asia Asset Finance PLC Colombo, a listed financial company in Sri Lanka, from 26 per cent to 51 per cent, making it a subsidiary. It intends to activate gold loans business in Sri Lanka through this company, he said.

Considering the long pause in growth due to regulatory uncertainties, a continued growth in two adjacent quarters was certainly a positive sign, he said.

"We expect profitability to improve further along with the increase in the loan portfolio. The company's NCD public issues are receiving tremendous response from retail investors and Muthoot would launch its next issue in February," he said.

Muthoot Finance also announced two new directors on its board - Pamela Anna Mathew George, chairperson of OEN and Alexander George.