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Results
01-Feb-23
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Analysis
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Max Financial Services
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Continues to strongly improve margins and VNB
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The income from operation of Max Financial Services
increased 27.92% to Rs 8895.52 crore in Q3FY2023. Overall OPM has
increased to 3.62% in Q3FY2023 from 1.60% in Q3FY2022, leading to 190.03% rise
in operating profit to Rs 322.25 crore. Other expenditure as a
percentage of total income moved down to 96.31% from 98.32% in Q3FY2023. The
staff cost as a percentage of total income declined to 0.07% from 0.09% in
Q3FY2023. The provisions as percentage of total income declined to
0% from 0% in Q3FY2023.
Other income increased 293.06% to Rs 2.83
crore. Interest cost increased 2.17% to Rs 9.4
crore. Depreciation moved down 6.56% to Rs 1.14
crore. PBT moved up 210.17% to Rs 314.54 crore.
The effective tax rate increased to 14.37% in
Q3FY2023 compared to 10.33% in Q3FY2022. Provision for tax was
expense of Rs 45.19 crore, compared to Rs 10.48 crore. Profit after
tax rose 196.22% to Rs 269.35 crore.
There was profit attributable to non-controlling
interest of Rs 44.41 crore as compared to Rs 16.07 crore. The share
of profit of associate were nil in both the periods. Finally, Net
profit attributable to owners moved up 200.48% to Rs 224.94 crore.
Business
performance
In the 9MFY23, the consolidated revenues eased 3%
to Rs 21497 crore due to lower investment income. Excluding investment income,
the consolidated revenues at Rs 15,890 crore, grew 12%.
Consolidated PAT at Rs 399 Crore in 9MFY23, up
129%, due to lower new business strain than corresponding previous period.
In Q3FY23, Consolidated Revenue at Rs 8898 crore
were up 28% and Consolidated PAT at Rs 269 crore, up 196%.
During 9MFY23, New Business Premium grew 7% to Rs 5640
crore driven by strong growth in proprietary channels. Proprietary channels new
business premiums grew by 19% yoy to Rs 1,262 crore as result contribution of
Proprietary channels to total new sales increased from 28% in 9MFY22 to 34% in 9MFY23.
Further, the renewal premium income rose 16% to Rs 10,548 Crore, taking the
gross written premium Rs 16188 crore, up 12% yoy.
Max Life achieved highest New Business Margin (NBM)
of 31.8% in 9MFY23, improved by 670 bps over corresponding previous period.
Further NBM expanded to 39.2% in Q3FY23, an increase of 1430 bps quarter mainly
driven by higher non-participating product mix. Value of New Business (VNB)
grew by 25% to Rs 1179 crore in 9MFY23 and by 50% to Rs 593 crore in Q3FY23.
Max Life policyholders cost to gross premium ratio
improved from 21.4% in 9MFY22 to 20.4% in 9MFY23 due to effective cost
management efforts and higher business growth. Max Life reported an Embedded
Value of Rs 15,547 crore, while the Operating Return on EV (RoEV) in 9MFY23
improved by 140 bps to 19.5%.
During 9MFY23, Max focused on retirement segment led
to growth of 300% in Annuity business in 9MFY23. Max Life`s assets under
management (AUM) were Rs 118400 crore end December 2022 - a rise of 16% over
the previous period.
Max Life Pension Fund Management commenced business
operations in Q2FY23, and also received PoP license which will support further
growth. Max Life has secured a new banca partnership with Ujjivan Small Finance
Bank and 2 new renowned Broker partnerships in Q3FY23.
Max Financial completed acquisition of 5.17% stake
of Max Life from MSI in December 2022, post-acquisition Max Financial
shareholding in Max Life increased to 87%
Agreements amended with Axis Bank for the right to
acquire balance 7% stake sale of Max Life at Fair Market Value
Prashant Tripathy, Managing Director, Max Life
Insurance Company Limited, said, "Through the introduction of new
innovative products, secular growth across proprietary channels, and a balanced
product mix, we achieved a strong growth in Q3FY23. In addition to accelerate
bancassurance channel growth, we are focused on continuous growth through strategic
partnerships and improved market share."
Financial
performance 9MFY2023
The income from operation of Max Financial Services
declined 3.32% to Rs 21483.3 crore in 9MFY2023. Overall OPM has
increased to 2.27% in 9MFY2023 from 1.13% in 9MFY2022, leading to 93.87% rise
in operating profit to Rs 486.97 crore. Other expenditure as a
percentage of total income moved down to 97.62% from 98.67% in 9MFY2023. The
staff cost as a percentage of total income declined to 0.12% from 0.21% in
9MFY2023.
Other income increased 257.94% to Rs 13.53
crore. Interest cost increased 82.18% to Rs 28.22
crore. Depreciation moved down 2.22% to Rs 3.52
crore. PBT moved up 98.73% to Rs 468.76 crore.
The effective tax rate declined to 14.79% in
9MFY2023 compared to 25.98% in 9MFY2022. Provision for tax was
expense of Rs 69.32 crore, compared to Rs 61.28 crore. Profit after
tax rose 128.77% to Rs 399.44 crore.
There was profit attributable to non-controlling
interest of Rs 66.85 crore in 9MFY2023 as compared to Rs 38.71 crore in
9MFY2022. The share of profit of associate were nil in both the
periods. Finally, Net profit attributable to owners rose 144.75% yoy
to Rs 332.59 crore in 9MFY2023.
Max Financial Services : Consolidated Results
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Particulars
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2212 (3)
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2112 (3)
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Var %
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2212 (9)
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2112 (9)
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Var %
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2203 (12)
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2103 (12)
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Var %
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Income from Operations
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8895.52
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6953.99
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28
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21483.30
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22221.49
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-3
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31181.14
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31273.91
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0
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OPM (%)
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3.62
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1.60
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202 bps
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2.27
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1.13
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114 bps
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1.32
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1.87
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-55 bps
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OP
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322.25
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111.11
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190
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486.97
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251.19
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94
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411.95
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584.38
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-30
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Other Inc.
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2.83
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0.72
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293
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13.53
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3.78
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258
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6.44
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14.11
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-54
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PBDIT
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325.08
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111.83
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191
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500.50
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254.97
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96
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418.39
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598.49
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-30
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Interest
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9.40
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9.20
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2
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28.22
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15.49
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82
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24.74
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0.27
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9063
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PBDT
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315.68
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102.63
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208
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472.28
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239.48
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97
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393.65
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598.22
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-34
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Depreciation
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1.14
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1.22
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-7
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3.52
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3.60
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-2
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5.00
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5.32
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-6
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PBT before EO
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314.54
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101.41
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210
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468.76
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235.88
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99
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388.65
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592.90
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-34
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EO
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0.00
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0.00
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-
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0.00
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0.00
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-
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0.00
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0.00
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-
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PBT after EO
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314.54
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101.41
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210
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468.76
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235.88
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99
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388.65
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592.90
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-34
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Tax Expenses
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45.19
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10.48
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331
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69.32
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61.28
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13
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70.25
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33.15
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112
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PAT
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269.35
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90.93
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196
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399.44
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174.60
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129
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318.40
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559.75
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-43
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Non-controlling interest
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44.41
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16.07
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176
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66.85
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38.71
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73
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65.03
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134.36
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-52
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Share of P&L from Asso.
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0.00
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0.00
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-
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0.00
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0.00
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-
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0.00
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0.00
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-
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Net profit
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224.94
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74.86
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200
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332.59
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135.89
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145
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253.37
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425.39
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-40
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EPS (Rs)*
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26.1
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8.7
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12.9
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5.3
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7.3
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12.3
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EV (Rs)/share
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450.5
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388.6
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450.5
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388.6
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410.7
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342.9
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* Annualised on current equity of Rs 69.02 crore, Face value of
Rs 2, Excluding extraordinary items.
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bps : Basis points
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EO : Extraordinary items
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Figures in Rs crore
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Source: Capitaline Corporate Database
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