Arman Financial reports 138% increase in Q1 FY20 profit

Arman Financial Services Ltd (Arman), a Gujarat based non-banking financial company (NBFC), with interests in microfinance, two-wheelers and micro-enterprise (MSME) loans, announced its financial results for the first quarter ended 30th June 2019.

The Arman Financial Services Ltd (Arman) has announced a profit of 138% in the first quarter of the financial year 2019-20. 

According to the financial details released by the company, Asset under management as on 30 June 2019 stood at Rs. 722.5 crore (+57% YoY). The total disbursements as on 30 June 2019 stood at Rs. 191.8 crore (+24% YoY). "The Gross Total Income of the company increased by 69% to Rs. 48.2crore from Rs. 28.5crore while Net Total Income increased by 75% to Rs. 29.9 crore from Rs. 17.1 crore" said a statement issued by the company. It further added, "Cost-to-Income Ratio improved to 35.5% for Q1 FY20 as against 43.5%. The profit after tax increased by 138% to Rs. 12.1 crore from Rs. 5.1 crore consolidated Debt-Equity Ratio (on a fully diluted basis) as of 30 June 2019 stood at 4.58,". 

Commenting on the Company’s performance for Q1FY2019-20, Mr. Jayendra Patel, Vice Chairman & Managing Director, Arman Financial Services said, “Despite the ongoing liquidity tightening and other macroeconomic headwinds, Armandelivered a strong all-round performance in the first quarter, driven by robust growth in our loan book combined with improvements in NIM,cost-to-income ratio and asset quality. This was the first quarter of the Indian Accounting Standard (IndAS) implementation, which resulted in several notional changes in the Financials compared to the previous iGAAP Standards. The growth in our loan assets was characterised by a healthy jump across all 3 of our lending segments. Further, we enhanced our geographic presence by launching41 new branches during the quarter as a part of our FY20 expansion strategy,". He further added, "positive ALM, superior asset quality and a strong performance track record have helped us keep our finance costs in check and maintain adequate liquidity, despite the tough liquidity conditions faced by the NBFC sector in general. Disciplined lending backed by a rigorous credit appraisal and collection model has enabled us to keep our credit costs under control. Our consolidated Debt-Equity Ratio stood at 4.58:1, which provides us with sufficient capital to drive growth in the current year. Moving forward, our endeavour is to continue our growth momentum, while exercising prudence in lending and maintaining adequate liquidity. We will closely monitor rural macroeconomic indicators and make all necessary adjustments to protect asset quality,". 

 

Particulars (In Crores)	Q1 FY20	Q1 FY19	YoY%	FY19 *
Assets Under Management (AUM)	722.5	460.3	57%	684.7
Total Disbursement	191.5	154.8	24%	789.8
Gross Total Income	48.2	28.5	69%	141.1
Profit After Tax	12.1	5.1	138%	21.3
GNPA %	1.1%	1.6%	-51 bps	1.0%
NNPA %	0.6%	1.1%	-41 bps	0.9%
RoE %**	34.6%	18.3%	1,635 bps	25.9%

Note: *FY19 figures are as per I-GAAP while quarterly figures are as per IndAS Accounting standards                         

** RoE figures are annualized on a fully diluted equity-based. 

 (With inputs from Arman Financial Services Ltd)