Mahindra & Mahindra Financial Services reported 30% drop in standalone net profit to Rs 629 crore in Q3 FY23 from Rs 894 crore in Q3 FY22.
As per media reports, various research firms had predicted a profit of Rs 360 for the quarter under review.
"Third quarter of the previous year continued with significant reversal of impairment provisions as a result of improvement in asset quality which had deteriorated during Q1 FY22 due to second wave of COVID-19. This resulted in a PAT of Rs 894 crore for Q3 FY22, the NBFC said.
Total Income in the third quarter was at Rs 2,892 crore, up 14% YoY. Net Interest Income (NII) for Q3 FY23 was at Rs 1,650 crore, up 7% YoY. Net Interest Margin for the quarter was at 7.4%.
Provisions and write-offs amounted to Rs 155 crore in Q3 FY23. The company had written back provisions aggregating to Rs 148 crore in Q3 FY22.
The company's gross stage 3 improves to 5.9% (6.7% in Q2 FY23) and gross stage 2 improves to 8.4% (9.7% in Q2 FY23). Provision coverage on Stage 3 loans was maintained at 59.0%.
Loan Book increased by 21% to Rs 77,344 crore compared to Q3 FY22. Disbursement for the quarter at Rs 14,467 crore was up 80% on YoY basis.
The company said that the SME asset book which is over Rs. 4,000 Crores has grown 10% sequentially and contributes 5% of the Business Assets aided by disbursement towards supply-chain funding. Our leasing business Quiklyz recently signed MOUs with five last mile mobility players to deliver 1000 electric 3-wheelers, opening up newer opportunities in EV leasing.
The YTD disbursement of Rs. 35,764 crores registered a YoY growth of 95%. This led to a asset book of Rs. 77,344 crores, a growth of 21% YoY and 5% sequentially. During Q3, the company was able to pass on the increase in borrowing costs, which improved yields.
Collection Efficiency for the quarter stood at 95%, similar to the third quarter of previous year.
As of December end, the company carried a total liquidity buffer of approximately Rs 10,800 crore - covering more than 3 months' obligations. Capital Adequacy stood at 23.4%.
On a consolidated basis, Mahindra Finance's total income increased by 12% to Rs 3,353 crore during the quarter ended 31 December 2022, as against Rs 2,986 crore during the corresponding quarter last year. The profit after tax (PAT) stood at Rs 664 crore during the quarter ended 31 December 2022, as against PAT of Rs 992 crore during the corresponding quarter last year.
Seperately, Mahindra & Mahindra Financial Services said that in January 2023, it estimates the total disbursement of approximately Rs 4,000 crore, delivering 58% growth over January 2022. Consequently, the loan book grew further by 1% over December 2022.
The collection efficiency (CE) was at 95% for January 2023 compared to 96% achieved in January 2022.
Mahindra & Mahindra Financial Services (Mahindra Finance), part of the Mahindra Group, is one of India's leading non-banking finance companies. Focused on the rural and semi-urban sector, the company has over 8.7 million customers and has an AUM of over USD 11 Billion. The company is a leading vehicle and tractor financier, provides loans to SMEs and also offers fixed deposits.
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