Cholamandalam Investment and Finance Company Q2 profit up 41%

CHENNAI:

Cholamandalam Investment and Finance Company

Q2 net

profit

up 41% at Rs 432 crore, with its asset under management (AUM) up at 16% Rs 74,471 crore in the September quarter on a year-on-year basis.

Its MD Arun Alagappan said, “The quarter gone by was critical not just for us, but for the entire banking and financial services industry. With the six-month moratorium ending in August 2020, the focus was to scale up on-field collection efforts, and the company has been able to make considerable improvement in the last two months. While the broader economy is still recovering, the company has witnessed a better than expected disbursement numbers in Q2 FY21, with the trend seeming to be on a positive trajectory in the coming quarters. The pent-up demand and the economic activities associated with the festive season are expected to boost business sentiments and improve disbursements and collections across the businesses. Looking ahead, while business as usual post Covid-19 is still sometime away, the past couple of months have given us enough reasons to be cautiously optimistic about H2 FY21.”

Aggregate disbursements were down by 13% in the second quarter at Rs 6,457 crore, as against Rs 7,381 a year ago. Vehicle Finance (VF) business registering a decline of 18% at Rs 4,781 crore while

loan

against property (LAP) business saw a marginal decline of 1% at Rs 1,052 crore loan disbursement. Home Loan (HL) business saw lower disbursement at Rs 381 crore in Q2 FY 21, as against Rs 414 crore in Q2 FY20.

The NBFC said it had over 95% of the moratorium customers starting to repay their instalments till date. However, considering the externalities in the market, on a prudent basis the Company has created additional provisions of Rs 250 crore towards macro provisions during this quarter in Stage 1 and 2. Including this, the cumulative additional provisions towards macros stand at Rs 800 crore.