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L&T Finance Holdings posted a 66 per cent growth in consolidated profit after tax for the third quarter ended December 31 at Rs 82 crore, compared to the corresponding period a year ago, on the back of healthy margins, good fee income, well-managed operating costs and optimisation in borrowing costs.
Loans and advances grew 20 per cent year-on-year to Rs 45,225 crore. This has been aided by strong disbursement growth of 32 per cent across business-to-consumer products – tractors, two-wheelers, housing and microfinance in the retail business and operational projects in renewable, roads and non-infrastructure segments in the wholesale business.
“It was a satisfactory quarter for us. We had healthy growth in assets, disbursement and profit during the quarter as well as the nine month period,” said Y M Deosthalee, chairman and managing director of the company.
The consolidated net interest margin at the end of the quarter stood at 5.6 per cent, compared with 5.2 per at the end of the quarter ended December, 2013. Gross non-performing assets (NPAs) stood at three per cent compared to 2.9 per cent in the corresponding period a year ago.
The company has continued to make additional provisions in the quarter, increasing the provision coverage to 35 per cent at the consolidated level. In line with the conservative provisioning policy, the company carries Rs 190 crore of provisions in excess of Reserve Bank of India norms.
In the retail and mid-market finance segments, the fee income was at Rs 35 crore during the quarter compared with Rs 9 crore a year ago.
In the wholesale finance business, the fee income was at Rs 34 crore compared with Rs 2 crore in the corresponding quarter a year ago.
The operating expenses for the retail and mid-market finance segments was at Rs 62 crore compared with Rs 134 crore in the corresponding quarter a year ago. The operating expenses for the wholesale finance business was Rs 29 crore during the quarter compared with Rs 22 crore a year ago.
