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Mahindra and Mahindra Financial Services
(MMFSL), on a consolidated basis, has reported the net profit to Rs 987.03 crore
in the quarter ended December 2021 (Q3FY2022), while snapping net loss of Rs
226.20 crore in Q3FY2021. With the improved collection performance, the company
has improved asset quality and margins. The company has also reversed
provisions, boosting the earnings of the company in Q3FY2022.
The credit cost for the company was
negative at 81 bps (annualized) in Q3FY2022 compared with negative 198 bps in
preceding quarter and 886 bps in the corresponding quarter last year. The net
interest margin (NIM), on calculated basis, of the company improved to 10.00% in
Q3FY2022 compared with 8.34% in the corresponding quarter last year.
Income from Operations declined 1% to Rs 2845.59
crore during the quarter ended December 2021, compared to the corresponding
previous year quarter. Other Income rose 7% to Rs 140.06 crore. The total
Income was flat at Rs 2985.65 crore, while interest expenses dipped 18% to Rs 1070.72
crore in the quarter ended December 2021.
The staff cost moved up 23% to Rs 414.61 crore,
while other operating expenses jumped 58% to Rs 271.06 crore. The ensuing
operating profit rose 5% to Rs 1229.26 crore in the quarter ended December
2021.
Depreciation declined 3% to Rs 35.37 crore
during the quarter under review. Provisions were reversed amounting to Rs 129.70
crore. The profit before tax jumped to Rs 1323.59 crore. After accounting for
taxation of Rs 341.87 crore, net profits increased to Rs 987.03 crore in the
quarter ended December 2021.
The
gross business assets were at Rs 63944 crore end December 2021, as against Rs
66525 crore end December 2020. With uptick in disbursements, the company expect
further growth in its business assets.
Asset Quality
GNPA dipped to 11.30% of total asset at end
December 2021 from 12.68% a quarter ago. NNPA ratio also declined to 5.63% on
sequential basis from 6.39% a quarter ago. NPA coverage ratio improved to 53.20%
at end December 2021 from 53.00% at end December 2020.
As
of December 31, 2021, the restructured loans stood at Rs 4378 Crore. The
Company carried a cumulative provision of Rs 873 crore (19.9% coverage) on such
contracts end December 2021.
The
cumulative management overlay end December 2021 stood at Rs 2038 crore.
On
November 12, 2021, the Reserve Bank of India issued a circular on Prudential
Norms on Income Recognition, Asset Classification and Provisioning pertaining
to Advances (IRACP). The Gross NPA as per IRACP norms was Rs 10897 crore end
December 2021, after giving effect to the above circular. As the Company
continues to follow IND-AS accounting, there is no impact on gross stage 3
which was at Rs 7223 crore end December 2021. The cumulative impairment
provision under IND-AS end December 2021 was higher by Rs 1877 crore in
comparison to the requirements under the IRACP norms after giving due
effect to the above circular. The
management believes that enhanced collection and legal efforts, including
repossessions and settlements should help reduce Gross NPA (IRACP) by March
2022 end. The Company may require to make an additional provision in the range
of Rs 500 crore to Rs 1500 crore in Q4FY22 in order to bring the Net NPA under
IRACP norms below 6.0%.
Book
value of the company on
standalone basis stood at Rs 122.0 per share and adjusted book value stood at
Rs 91.0 per share end December 2021. Book value of the company on consolidated
basis stood at Rs 131.7 per share and adjusted book value stood at Rs 91.9 per
share end December 2021.
Mahindra Rural Housing
Finance (MRHFL)
MRHFL registered income at Rs 352.6 crore in Q3FY2022 as
against Rs 354.5 crore during the corresponding quarter last year, a decline of
1% over the same period previous year. The Profit After Tax (PAT) registered
was Rs 66.9 crore, as against Rs.11.4 crore during the corresponding quarter
last year.
MRHFL continues to follow IND-AS accounting, hence there is
no impact on Gross Stage 3 assets with respect to the RBI Circular dated 12th
November 2021. MRHFL maintains total provisions of Rs 754 crore under IND-AS.
These adequately cover the provision requirement of Rs 669 crore under the
IRACP requirements.
The restructured loans stood at Rs 2577 crore end December
2021. MRHFL carried a cumulative provision of Rs 337 crore (13.1% coverage) on
such contracts end December 2021.
MRHFL has cumulative management overlay of Rs 80.2 crore as
on 31 December 2021 for covering the contingencies that may arise due to the
COVID 19 pandemic.
Mahindra Insurance Brokers
(MIBL)
MIBL registered income at Rs 97 crore in Q3FY2022 as against
Rs 81 crore during the corresponding quarter last year, a growth of 20% over
the same period previous year. The Profit After Tax (PAT) registered was Rs 18
crore during the quarter ended December 31, 2021, as against Rs 15 crore during
the corresponding quarter last year.
Mahindra Manulife Investment
Management (MMIMPL)
MMIMPL earned total income of Rs 8.5 crore in Q3FY2022 as
compared to Rs 8.4 crore in the same period previous year. MMIMPL incurred a
loss of Rs 9.0 crore compared to a loss of Rs 8.0 crore during the same period
of the previous year.
The Average Assets under Management (AUM) of MMIMPL for
December-21 quarter were Rs 7911 crore, up from Rs 6687 crore for September
2021. About 64% of the closing AUM comprises Equity Mutual Fund AUM.
Mahindra Manulife Trustee
(MMTPL)
MMTPL earned total income of Rs 0.2 crore in Q3FY2022
compared to Rs 0.1 crore during the same period previous year. MMTPL made a
profit of Rs 0.1 crore compared to a breakeven (no profit / no loss) position
during the same period of the previous year.
Mahindra Ideal Finance
(MIFL)
Consequent upon Ideal Finance Limited becoming a subsidiary of
the Company effective from 8 July 2021, its name has been changed to Mahindra
Ideal Finance with effect from 28 January 2022.
MIFL registered income at LKR 344.1 Million as against LKR
257 Million during the corresponding quarter last year, registering a growth of
34% over the same period previous year. The Profit After Tax (PAT) during the
quarter ended December 31, 2021, was LKR 76.6 Million as against LKR 53.6
Million during the corresponding quarter last year, a growth of 43% over the
same period previous year.
Mahindra Finance USA (MFUSA)
MFUSA registered income at USD 14.2 Million in Q3FY2022 as
against USD 15.2 Million during the corresponding quarter last year,
registering a decline of 7% over the same period previous year. The Profit
After Tax (PAT) in Q3FY2022, registered was USD 4.1 Million as against USD 7.9
Million during the corresponding quarter last year, registering a decline of
48% over the same period previous year.
Financial
Performance 9MFY2022:
For the half year
ended December 2021 (9MFY2022), MMFSL reported 8% decline in the income from
Operations to Rs 8128.85 crore, against the corresponding previous year period.
Other Income increased 16% to Rs 374.22 crore. As a result, the total Income fell
7% to Rs 8503.07 crore. Interest expenses declined 18% to Rs 3364.43 crore, while
the operating expenses increased 30% to Rs 1854.72 crore leading the operating
profits to decline 9% to Rs 3283.92 crore. Depreciation eased 10% to Rs 102.34 crore,
while provisions & write-off dipped 17% to Rs 2560.13 crore. PBT jumped 46%
to Rs 621.45 crore. EO income decline to Rs 20.57 crore in 9MFY2022 from Rs
228.54 crore in 9MFY2021, leading to 2% decline in PBT after EO to Rs 642.02
crore in 9MFY2022. The effective tax rates stood at 24.8% in 9MFY2022 compared
with 17.9% in 9MFY2021. Net Profit declined 8% to Rs 513.09 crore in 9MFY2022
over 9MFY2021.
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Mahindra &
Mahindra Financial Services: Consolidated Results
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Particulars
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2112 (3)
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2012 (3)
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Var %
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2112 (9)
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2012 (9)
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Var %
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2103 (12)
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2003 (12)
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Var %
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Income from
operations
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2845.59
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2862.42
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-1
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8128.85
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8808.29
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-8
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11703.79
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11457.61
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2
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Other Income
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140.06
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130.52
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7
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374.22
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323.84
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16
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466.71
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538.85
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-13
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Total Income
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2985.65
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2992.94
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0
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8503.07
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9132.13
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-7
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12170.50
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11996.46
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1
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Interest Expenses
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1070.72
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1311.77
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-18
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3364.43
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4081.46
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-18
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5307.57
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5390.56
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-2
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Operating Expense
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685.67
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507.96
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35
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1854.72
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1423.56
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30
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2047.62
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2583.92
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-21
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Gross Profits
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1229.26
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1173.21
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5
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3283.92
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3627.11
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-9
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4815.31
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4021.98
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20
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Depreciation /
Amortization
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35.37
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36.51
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-3
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102.34
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113.96
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-10
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150.51
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146.87
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2
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Provisions and
write off
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-129.70
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1473.99
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LP
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2560.13
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3088.66
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-17
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3998.74
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2318.98
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72
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PBT before EO
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1323.59
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-337.29
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LP
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621.45
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424.49
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46
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666.06
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1556.13
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-57
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Extra ordinary
item (EO)
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0.00
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0.00
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-
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20.57
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228.54
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-91
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228.54
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0.00
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-
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PBT after EO
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1323.59
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-337.29
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LP
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642.02
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653.03
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-2
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894.60
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1556.13
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-43
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Tax Expense
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341.87
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-89.68
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PL
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159.12
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117.05
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36
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153.86
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516.21
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-70
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Net Profit
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981.72
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-247.61
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LP
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482.90
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535.98
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-10
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740.74
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1039.92
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-29
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Minority Interest
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5.26
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3.02
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74
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8.74
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4.57
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91
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7.07
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10.67
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-34
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P&L of Ass Co.
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10.57
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24.43
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-57
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38.93
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25.46
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53
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39.54
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45.90
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-14
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PAT
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987.03
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-226.20
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LP
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513.09
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556.87
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-8
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773.21
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1075.15
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-28
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EPS
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32.0
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-
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5.4
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4.0
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4.7
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8.7
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*Annualized on
current equity of Rs 246.44 core excluding EO and relvant tax. Face Value: Rs
2, Figures in Rs crore, PL: Profit to Loss, LP: Loss to
Profit
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Source:
Capitaline Corporate Database
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