Highlights:

* The consolidated net profit of the company declined 12% to Rs 220 crore in Q3FY2019, as consolidated income declined 2% to Rs 990 crore in Q3FY2019.

* The loan assets under management in the NBFC business surged 33% to Rs 36400 crore end December 2018. Wealth assets moved up 25% to Rs 160573 crore end December 2018.

* Liquidity conditions were challenging in Q3FY2019, while the credibility of the company with the investors helped to securitize assets and the maturity profile of assets and the liabilities were comfortable. The company has reduced CP significantly down to 10-12%. The company does not see any significant challenge in raising resources over medium to long term and continue to grow businesses as usual.

* The real estate sector saw some spike in the gross NPA as large ticket real estate or construction finance loans because now the recognition norm is 90 days. The company strongly believes that collateral cover is good in each and every case and the company should not suffer any losses.

* Securities business is bit more cyclical and the investment banking activities have been at a low and will continue subdued unless capital markets sentiments changes. The focus remains on becoming more efficient in terms of cost and trying to move digitally and online as quickly and as much as possible and also as innovatively as possible.

* The business re-organization is on track as scheduled, the shareholders approval was done in December and now a final hearing with NCLT is scheduled in the mid of February, and from there a few procedural requirements will be carried out which will take a couple of months.

NBFC business

* The Loans and Mortgages business is carried out by a non-banking finance company and its two subsidiaries, housing finance company and micro finance company, conducted through 1,862 branches spanning the length and breadth of the country.

* The profit after tax rose 6% to Rs 108 crore for Q3FY19, as total income increased 12% to Rs 602 crore. NBFCs ROE1 for Q3FY19 stood at 11.1% and ROA1 was 1.3%. Average borrowing costs increased by 56 bps y-o-y to 9.0%. Net Interest Margin was at 7.1%.

* Loan assets under management (AUM), predominantly retail, showed a strong growth of 33% y-o-y to Rs 36400 crore, mainly driven by small-ticket home loans, Gold loans, SME loans and microfinance loans. At the end of the quarter, retail home loan assets grew 49% to Rs 11208 crore.

* The microfinance business continued its steady growth, with the loan AUM growing 205% y-o-y to Rs 1753 crore end December 2018. The MFI customer base increased to over 8 lakh customers and branch network grew to 492 branches.

* About 85% of loans are retail in nature and 47% are PSL compliant. The securitized loan book, currently at Rs 9058 crore, is 25% of AUM. There exists significant opportunity for securitization, which will positively impact profitability and CAR.

* GNPA stood at 3.7% and NNPA stood at 1.5% end December 2018. With implementation of Expected Credit Loss under IndAS, specific provision coverage on NPAs stands at 60%.

* IIFL Finance has long-term credit rating by CRISIL AA/Stable, ICRA-AA (Stable), CARE AA (Positive).

* Total CAR stood at 20.7% including Tier I capital of 17.4% end December 2018, as against statutory requirement of 15% and 10% respectively.

* IIFL Finance launched an issue for secured and unsecured redeemable non-convertible debentures (NCDs), aggregating to Rs 250 crore, with a green-shoe option to retain over-subscription up to Rs 1750 crore (aggregating to a total of Rs 2000 crore) on 22 January 2019. The instruments are rated CRISIL AA/Stable by CRISIL, [ICRA] AA (Stable) by ICRA, and BWR AA+/Stable by Brickworks.

* The Company has received bids worth over Rs 1000 crore till date, which is over 4 times the base issue size of Rs 250 crore. Investors included a number of marquee institutional investors and HNIs.

Wealth management

* IIFL Wealth Management has catapulted itself to become the largest private wealth management firm in India in a decade since its inception. IIFL Wealth has over 900 employees and presence in 9 major global financial hubs spread across 26 locations in India and around the world.

* The total assets under management, distribution and advice witnessed 25% y-o-y growth to reach Rs 160573 crore in Q3FY19. The assets of the asset management business were Rs 22955 crore end December 2018. The profit after tax for the quarter was at Rs 79 crore.

* The company has completed the acquisition of Altiore Advisors and Wealth Advisors India during the quarter, both are now wholly owned subsidiaries of the company.

* The company targets wealth management yield of 75 to 80 bps.

Capital Markets

* The company has over 1,400 service locations comprising a wide branch and sub-broker network and providing unparalleled research coverage on over 500 companies.

* IIFL Capital Markets net profits showed a de-growth of 18% y-o-y to Rs 33.5 crore in Q3FY2019. During the quarter, the average daily market turnover (including F&O) for the broking business was Rs 16370 crore, up 10% y-o-y and market share stands at 3.5% of average daily market cash turnover.

* Mobile trading app, IIFL Markets continues to be the highest rated amongst peers (4.3) with over 23 lakh downloads. Mobile brokerage constituted about 38% of the total.

* IIFLs Mutual Fund App crossed 4.3 lakh downloads with a 4.3 star rating, and is steadily building on its customer base.

* IIFL Investment Banking has completed 12 transactions across various products in the year to date and has a number of transactions in various stages of execution.