Shriram Transport Finance Q1 net drops 47 pc to Rs 170 cr on higher provisions
Shriram Transport Finance Company STFC on Friday reported a 47 per cent decline in consolidated net profit at Rs 170 crore for the June quarter due to accelerated provisions against expected credit loss. As at June 30, 2021, additional ECL provision on loan assets as management overlay on account of Covid-19 stood at Rs 2,852.50 crore, it said.
Shriram Transport Finance Company (STFC) on Friday reported a 47 per cent decline in consolidated net profit at Rs 170 crore for the June quarter due to accelerated provisions against expected credit loss. The company had registered a net profit of Rs 320 crore in the same quarter a year ago. Compared sequentially, the net was down by 77.5 per cent from Rs 755 crore in the March 2021 quarter. Total income during Q1 FY22, however, was higher at Rs 4,651.50 crore from Rs 4,144.17 crore in Q1FY21, the company said in a regulatory filing. Interest income rose to Rs 4,479.28 crore from Rs 4,102.58 crore. STFC said certain segments of the company's business operations were affected due to the prolonged lockdown imposed by state governments to curb COVID-19 infections. The company has considered additional expected credit loss (ECL) on loans of Rs 261 crore during the June quarter. ''As at June 30, 2021, additional ECL provision on loan assets as management overlay on account of Covid-19 stood at Rs 2,852.50 crore,'' it said. The assets under management (AUM) stood at Rs 1.19 lakh crore by end of June 2021, as against Rs 1.12 lakh crore earlier. The Q1 numbers include the results of STFC, the holding company, and associate firm Shriram Automall India Ltd. STFC said its board of directors also approved periodical resource mobilisation by issuance of debt securities. The company plans to issue such instruments on a private placement basis in tranches from August 1 to October 31, 2021, it added. The flagship company of the Shriram Group, STFC mainly provides finance for commercial vehicle industry. Shriram Transport Finance stock closed 1.38 per cent up at Rs 1,391.45 apiece on BSE.
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