Income from operations improved 16% to Rs 2072.11 crore in the quarter ended June 2019. Interest expense increased 29% to Rs 732.42 crore, while other expenses (including staff cost of Rs 269.7 crore and other expenses of Rs 177.54 crore) moved up 11% to Rs 447.24 crore. Ensuing Gross profit improved 10% to Rs 892.45 crore in Q1FY2020 over Q1FY2019.

Depreciation moved up to Rs 12.31 crore in Q1FY2020 from Rs 10.85 crore in Q1FY2019, while provision and write offs increased to Rs 16.5 crore in Q1FY2020 from Rs 10.94 crore in Q1FY2019.

PBT increased 9% to Rs 863.64 crore. Effective tax rate was nearly flat at 34.8% in Q1FY2020 from 34.7% in Q1FY2019. The minority interest moved up 58% to Rs 7.13 crore. The net profit of the company after minority interest increased 8% to Rs 556.19 crore in the quarter ended June 2019.

Business performance

Gross retail gold loan AUM of the company increased 16% yoy to Rs 35816 crore at end June 2019. The loan book of subsidiaries moved up 33% to Rs 4412 crore end June 2019.

The net Interest margin (NIM) of the company, on calculated basis, eased by 102 bps on sequential basis to 13.28% in Q1FY2020.

Gross stage 3 assets of the company increased to 3.20% at end June 2019 from 2.72% at end a quarter ago. ECL Provisionas % of Gross Loan Assets increased to 1.93% at end June 2019 from 1.86% a quarter ago.

CRAR ratio was at comfortable level of 24.72% at end June 2019.

Branch network of the company increased to 4502 branches end June 2019. Employee count increased to 24644 at end June 2019 from 24224 a quarter ago.

Book value of the company stood at Rs 243.2 per share at end June 2019. Adjusted book value (adjusting for net stage 3 assets) stood at Rs 231.8 per share at end June 2019.

Subsidiaries

Muthoot Finance (MFIN), the largest gold financing company in India in terms of loan portfolio, registered 8% increase in net profit to Rs 530 crore for Q1FY20 as against Rs 492 crore in the previous year. Loan Assets stood at Rs 35816 crore end June 2019 as against Rs 30997 crore as at June 2018, showing growth of 16%. Loan Assets increased by Rs 1570 crore in Q1FY2020.

Muthoot Homefin (MHIL), the wholly owned subsidiary, increased its loan portfolio to Rs 1988 crore as against previous year of Rs 1621 crore, a YoY increase of 23%. During Q1FY20, loan portfolio increased by Rs 80 crore. Total revenue for Q1FY20 stood at Rs 62 crore as against previous year total revenue of Rs 49 crore. It achieved a profit after tax of Rs 6 crore in Q1FY20 as against previous year profit of Rs 11 crore. Its Stage III Asset on Gross Loan Asset % as on June 2019 stood at 0.81%.

Belstar Investment and Finance Private (BIFPL), an RBI registered micro finance NBFC and Subsidiary Company where Muthoot Finance holds 70.01% stake, grew its loan portfolio to Rs 1939 crore as against last year of Rs 1237 crore, a YoY increase of 57%. During Q1FY20, loan portfolio increased by Rs 97 crore. It achieved a profit after tax of Rs 23 crore in Q1FY20 as against previous year profit after tax of Rs 12 crore. Its Stage III Asset on Gross Loan Asset % as on June 2019 stood at 1.16%.

Muthoot Insurance Brokers (MIBPL), an IRDA registered Direct Broker in insurance products and a wholly owned subsidiary company generated a total premium collection amounting to Rs 61 crore in Q1FY20 as against Rs 50 crore in the previous year. It generated a Profit after Tax of Rs 3 crore in Q1FY20 as against Rs 2 crore in the previous year.

The Sri Lankan subsidiary - Asia Asset Finance PLC (AAF) where Muthoot Finance holds 72.92% stake, increased its loan portfolio to LKR 1290 crore as against last year of LKR 10,68 crore, a YoY increase of 21%. During Q1FY20, loan portfolio increased by LKR 33 crore. Total revenue for Q1FY20 stood at LKR 80 crore as against previous year total revenue of LKR 69 crore. It generated a profit after tax of LKR 3 crore in Q1FY 20 as against previous year profit after tax of LKR 2 crore.

Muthoot Money (MML), became a wholly owned subsidiary of Muthoot Finance in October 2018. MML is a RBI registered Non- Banking Finance Company engaged mainly in extending loans for vehicles. The operations are now centered in Hyderabad. Recently, Company has started extending loans for Commercial Vehicles and Equipments. During Q1FY20, it has increased its loan portfolio to Rs 393 crore. During Q1FY20, loan portfolio increased by 82 crore. Total revenue for Q1FY20 stood at 14 crore.

Annual Financial Performance:

For the year ended March 2019 (FY2019), the company reported 13% rise in Income from operations at Rs 7594.43 crore, on consolidated basis. Other income declined 90% to Rs 6.62 crore in FY2019. The total income improved 12% to Rs 7601.05 crore. Interest expense increased 19% to Rs 2535.47 crore, while other expenses moved up 21% to Rs 1686.51 crore. Ensuing Gross profit rose 3% to Rs 3379.07 crore. Depreciation was flat at Rs 51.69 crore, while provision and write offs declined 75% to Rs 67.85 crore. PBT increased 11% to Rs 3259.53 crore. Effective tax rate stood at 35.5% compared to 37.3%. The minority interest increased 79% to Rs 24.95 crore. The final bottomline of the company inched up 14% to Rs 2078.01 crore in FY2019.