Mumbai : Muthoot Capital Services Ltd (MCSL), the first listed entity of the 130-year old Muthoot Pappachan Group, has registered an impressive all-round performance during the quarter ended 31st March 2017. The Company has recorded an overall AUM of Rs 1,440 crores on the back of aggressive two wheeler loan financing and corporate lending portfolio. The net profit during the quarter, increased from Rs 6.86 crores to Rs.11.12 crores, recording a growth of 62% from the same period last year. The total income increased to Rs.79.80 crores during the quarter ended 31st March 2017, from Rs. 63.40 crores during the same period last year, registering a growth of 26%.
The Board of Directors which met in Kochi today approved the results and declared bonus shares in the ratio 1:10
Commenting on the results, Muthoot Capital Services Ltd.’s Managing Director Mr. Thomas George Muthoot said ‘’while robust performance in spite of the tough market conditions excited us, the bigger excitement was largely on account of looking at business opportunities beyond the existing two-wheeler financing in the already established markets both in terms of geography and also new products”. He further said, “One of the key drivers for the company all these years was its commitment for innovative products. In the aftermath of demonetization when customers were struggling for cash we came up with a 100% funded gold-linked scheme The focus on newer geographies and other business loans helped a lot in burgeoning the loan book, besides adding to income and profitability”.
Mr. Madhu Alexiouse, COO of the Company, said, “We will continue with our expansion plans and enter more markets in the coming months. Emphasis on digitization and automation at all levels will ensure faster growth at lower cost in quicker time. This is expected to have a positive impact on the balance sheet over the coming years. The launch of the hassle-free e-payment and push towards the NACH facility for its auto loan customers has been seen favorably by all customers. It is meant to ease transaction process in keeping with the changing times. This enables Muthoot Capital’s large number of two-wheeler loan customers to repay the monthly instalment through the e-payment facility (using debit card or net banking) that would make transactions faster and easier. With pushing of the e- payments, the Company has been able to collect more on due dates and has reduced the follow up efforts and has been able to curtail delinquency. Mr Alexiouse said.
Muthoot Capital Services Ltd is a leading national player in the two-wheeler financing segment operating in 15 states. The Company showed remarkable improvement both in the topline and bottom-line of the NBFC, driven by innovative products, aggressive strategies and entry into new markets
For the Quarter ended March 2017
The net profit during the quarter, increased from Rs 6.86 crores to Rs.11.12 crores, recording a growth of 62% from the same period last year. The total income increased to Rs.79.80 crores during the quarter ended 31st March 2017, from Rs. 63.40 crores during the same period last year, registering a growth of 26%.
Interest expenditure increased from Rs. 22.34 crores during the same period last year to Rs. 25.76 crores, recording an increase of 15%. The total expenses during the corresponding period recorded an increase of 20%, from Rs. 52.45 crores to Rs 62.89 crores.
The profit before tax recorded an increase of 54% from Rs. 10.95 crores during the corresponding period of last year to Rs.16.91 crores during the quarter ended 31st March 2017.
For the Full Year ended March 2017
Commensurate with the quarterly figures, the yearly results also showed an impressive growth, with total income increasing to Rs. 284.20 crores compared to Rs228.49 crores during 2015-16, recording a growth of 24%.
The interest expenses during the period went up from Rs. 86.99 crores to Rs.103.95 crores, an increase of 19%. The total expenses rose from Rs. 193.04. Crores to Rs.238.01 crores, recording an increase of 23%.
On a full year basis (2016-17) MCSL achieved a PAT of Rs 30.09 crores as compared to Rs 22.85 crores achieved for the Year 2015-16, registering a growth of 32%
The improved performance of the Company was the direct result of a substantial growth in loan disbursements by the Company. The Company’s foray into corporate loans also helped boost the loan disbursements.
The total loan disbursements by the Company for the quarter ended 31st March 2017 was Rs423crores as compared to a disbursement of Rs315 for the same quarter last year.
For the full year 2016-17, the loan disbursement was Rs. 1298 crore compared to Rs. 928crores for the previous year.
The overall AUM as on 31st March 2017 was at Rs.1,440 crore as against Rs.1,038 crores of AUM recorded as on 31st March 2016, an overall growth of 39%. The financials of MCSL reported an AUM of Rs 1,204, which is net of the securitized portfolio which is removed from the books. During the year the Company did 4 Securitization PTC transactions of a total value of Rs. 378 crores.
The Company, after successful operations in South India and Western India, has expanded into the North Indian and East Indian markets besides diversifying into corporate loans. The Company is looking at several new products over the next 12-18 months to grow its portfolio and look at avenues for cross selling other products.
In the state of Kerala where the Company first started doing the business, it achieved a disbursement of Rs 500 crores in this financials year. With emphasis on sourcing business through the branches of Muthoot Fincorp Ltd (MFL), it achieved a disbursement of Rs 200 crs+ from the MFL branches. Going forward with much more emphasis on sourcing through MFL, the Company expects higher disbursements at lower sourcing costs.
The Company has, during the year, sourced fund through subordinated debts and also through securitization transactions, which was subscribed to by reputed banks and NBFCs which shows the confidence that the company has been able to arouse in the minds of the customers. This has helped in maintaining good Capital Adequacy Ratio besides laying foundation for sourcing equity in the future.
The company has already disbursed more than 8 lakhs loans till date in the two-wheeler financing segment. The total number of live accounts as on 31st March 2017 stood at approx. 4.20 lakhs and the total outstanding loan amount was Rs 1440 crores, including other business loans.
MCSL intends to improve the profitability over the coming years by tapping into additional sources of funding like Non-convertible debentures, Commercial Papers etc., apart from the traditional sources like bank loans and public deposits. Equity infusion would come in at the appropriate time