DHFL posts four-fold jump in Q1 consolidated net profit at Rs 314 crore

Dewan Housing Finance Corporation (DHFL) on Friday reported an over four-fold jump in its consolidated net profit at Rs 314.43 crore for the quarter ended June 2021.

The company had posted a net profit of Rs 70.10 crore in the same quarter a year ago and Rs 96.75 crore in the preceding quarter ended March 2021.

The total income, however, fell by 14 per cent to Rs 2,001.36 crore during Q1 FY22, as against Rs 2,328.86 crore in Q1 FY21 as interest income fell, DHFL said in a regulatory filing.

Interest earned in the June 2021 quarter fell to Rs 1,990.72 crore, as against Rs 2,315.93 crore earlier.

On the other hand, expenses reduced drastically to Rs 1,553.74 crore from Rs 2,236.05 crore.

The National Company Law Tribunal (Mumbai bench) had in June this year approved the resolution plan submitted by Piramal Capital & Housing Finance for the debt-ridden DHFL.

Subsequently, the company set up a monitoring committee in July, as per the terms of the resolution plan and the plan approval order.

The committee will supervise implementation of the resolution plan, conduct business operations of the company in accordance with the plan on a going concern basis and ensure that the value of the assets of the company does not deteriorate.

The Reserve Bank had superseded the board of DHFL in November 2019 and appointed an administrator to run the company following allegations of fraud and mismanagement.

Following this, RBI initiated corporate insolvency resolution process (CIRP) against DHFL under the Insolvency and Bankruptcy Code, 2016.

The committee of creditors of the company had approved the resolution plan under which the Piramal group is to acquire the firm.

"The company has incurred losses in the past, its liabilities exceeded total assets and its net worth was fully eroded and is continuing to be negative as on June 30, 2021," DHFL said.