Manappuram Finance net profit falls 44 pc to Rs 261 cr in March quarter

We have reduced Opex operating expenses during this quarter and we intend to maintain it at this level.We are focusing more on collection efficiency and quality growth in MFI books and building up gold loan portfolio, Manappuram Finance said in an investor presentation.The companys net interest income also fell by 10.2 per cent in the March quarter of FY22 to Rs 986.50 crore as against Rs 1,098.40 crore in the year-ago period.

Manappuram Finance on Wednesday reported over 44 per cent decline in net profit at Rs 261 crore in the quarter ended March 2022.

The company had posted a net profit of Rs 468 crore in the same quarter of the previous year.

''Our PAT (Profit After Tax) has been affected temporarily due to shifting of high yield to lower yielding gold loans. We have reduced Opex (operating expenses) during this quarter and we intend to maintain it at this level.

''We are focusing more on collection efficiency and quality growth in MFI books and building up gold loan portfolio,'' Manappuram Finance said in an investor presentation.

The company's net interest income also fell by 10.2 per cent in the March quarter of FY22 to Rs 986.50 crore as against Rs 1,098.40 crore in the year-ago period. It was up by 3.5 per cent from previous quarter's Rs 953.40 crore.

The income from operations were down by 8.7 per cent, at Rs 1,481.40 crore during the quarter from Rs 1,484.5 crore.

Talking about gold loan business, Manappuram Finance said currently over Rs 2 lakh ticket size constitutes 33 per cent of its Asset Under Management (AUM) which stood at Rs 30,300 crore as of March 2022.

The AUM of the gold loan financier grew by 11.2 per cent from a year ago, while it fell marginally by 0.5 per cent from preceding quarter.

''Our LTV is at 62 per cent as on March 31, 2022. We expect that as liquidity gets tighter and funding dries up, especially for some of our loss making competitors, we may see some revival of yields in the gold loan business,'' the company added.

For the full year 2021-22, the net profit of the company was down by 23 per cent at Rs 1,320.20 crore from Rs 1,708.60 crore.

Income was down by 4.3 per cent during the year, at Rs 6,061 crore from Rs 6,331 crore.

''Over the last fiscal year, we have restored the growth momentum in our microfinance, vehicle finance, and home loans businesses despite the disruptions from the third wave.

''At the same time, our core business of gold loans faced certain peculiar challenges arising from the intense price competition among the NBFCs which prevailed for much of the year thereby impacting our margins. However, we see this as a temporary phase, as unhealthy competition will benefit no one,'' V P Nandakumar, MD & CEO of Manappuram Finance, said.

Shares of Manappuram Finance closed 0.95 per cent down at Rs 104.60 apiece on BSE.

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