Diversified financial services group L&T Finance Holding today reported a 33 per cent increase in its consolidated net profit at Rs 216 crore in the quarter ended September, helped by healthy asset growth and fee income across all businesses.
The company had reported a net profit of Rs 162 crore in the same quarter last year.
"This is on the back of profitable asset growth and strong traction in fee income across all businesses," company's managing director Dinanath Dubhashi said.
In April 2016, the company unveiled its strategy to reach top quartile Return on Equity (RoE) by financial year 2020, through a combination of right businesses, right structures and right people.
"Since April 2016, we have been working relentlessly on implementing our strategic roadmap and we are beginning to see the results," he said.
The company's return on RoE for the second quarter stood at 11.72 per cent.
He said the company's profitable growth is visible in its disbursement growth and asset composition.
Dubhashi said the company's focused businesses- rural finance, housing finance and wholesale finance, recorded 24 per cent year-on-year growth mainly through increased disbursements in microfinance and housing finance.
Wholesale finance witnessed strong growth in IDF and syndicated assets.
The company has been running down its de-focused products which includes commercial equipment, commercial vehicle, new cars and SME term loan, among others, with no additional disbursements in this financial year.
As a percentage of total assets, the contribution of this portfolio has come down to six per cent in second quarter of financial year 2016-17 from 11 per cent in the year-ago period, Dubhashi added.
He said the company is evaluating alternatives to maximise value through sell-down.
Gross NPA improved to 4.70 per cent from 5.10 per cent while net NPA stood at 3.07 per cent from 4.05 per cent.
"Overall trend in the asset quality seems to be improving over the next few years," Dubhashi added.
In the investment management business, average assets under management (AAUM) for the quarter grew by 35 per cent to Rs 32,667 crore.
In the wealth management business, average assets under service (AAUS) went up by 38 per cent to Rs 10,890 crore in the quarter with client base growing from 3,700 to 5,140.
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