CHOLAMANDALAM INVESTMENT AND FINANCE COMPANY LIMITED (CIFCL)
AUDITED FINANCIAL RESULTS FOR THE QUARTER AND HALF YEAR ENDED
30th SEPTEMBER 2019
Total AUM crossed ₹ 64,000 Crs and Up 23%
Key Financial results (H1 FY 19-20):
Disbursements up at ₹ 15,954 Cr for the H1 FY 20 (Up 15% YoY).
Total Income up at ₹ 4,227 Cr for the H1 FY 20 (Up 29% YoY).
PBT up at ₹ 1,006 Cr for the H1 FY 20 (Up 12% YoY).
Total AUM up at ₹ 64,409 Cr (Up 23% YoY).
Gross Stage 3 Assets% reduced from 3.40% in Sep18 to 3.18% in Sep19
The Board of Directors of CIFCL today approved the audited financial results for the quarter and half year ended 30th September 2019.
Q2 and H1 FY 19-20 Performance:
The company has posted a strong performance in Q2 and H1 FY20, despite the prevailing tough market conditions.
· Aggregate disbursements for half year were at ₹15,954 Cr against ₹13,913 Cr in the previous half year of FY 19, registering a growth of 15%. The disbursements for the quarter ended September 19 were at ₹ 7,381 Cr as against ₹ 6,899 Cr for the quarter ended September 18, registering a growth of 7%.
· Vehicle Finance (VF) business has clocked a volume of ₹ 12,736 Cr for the period ended September 2019 as against ₹ 11,323 Cr in the previous year, reporting a growth of 12%. The same numbers for the quarter ended September 19 were at ₹5,796 Cr as against ₹5609 Cr for the quarter ended September 18, registering the growth of 3%. The slow-down in VF disbursement can be explained by the stagnation in the industry volumes during this quarter.
· Home Equity (HE) business disbursed ₹ 2,165 Cr as against ₹ 1,849 Cr for period ended September 2018, marking a growth of 17% Y-o-Y. Disbursements for the quarter ended September 2019 were at ₹ 1,064 Cr as against ₹ 910 Cr for the quarter ended September 18 registering a growth of 17%.
· AUM grew by 23% at ₹ 64,409 Cr in H1 FY20 as compared to ₹ 52,486 Cr in H1 FY19.
· Vehicle Finance (VF) AUM grew by 24% to ₹ 43,901 Cr in H1 FY20 as against ₹ 35,507 Cr in H1 FY19.
· Home Equity (HE) AUM grew by 17% to ₹ 12,612 Cr in H1 FY20 as against ₹ 10,742 Cr in H1 FY19.
· Profits before Tax (PBT) for the half year ended September 2019 were at ₹ 1,006 Cr as against ₹ 898 Cr last year registering a growth of 12%. For the quarter ended September 19, the PBT was at ₹ 523 Cr as against ₹ 460 Cr for the quarter ended September 18, registering the growth of 14%.
· The PBT-ROTA for H1 FY20 is at 3.4% and ROE for H1 FY 20 is at 19%
· Our Branch presence increased to 1029 Branches in H1 FY20.
Notwithstanding the tight market conditions, CIFCL continues to demonstrate strong asset quality and has been able to reduce the Stage 3 receivables from 3.40% in Sep’18 to 3.18% in Sep’19 (under IND AS) with a provision coverage of 34.4%. As per the traditional IGAAP approach too, the GNPA levels have reduced from 2.95% in Sep’18 to 2.75% in Sep’19 with a provision coverage of 43.1%.
The Capital Adequacy Ratio (CAR) of the company as on 30th September 2019, was at 17.09% as against the regulatory requirement of 15%.
Changes in Tax Rates:
Pursuant to the Taxation Laws (Amendment) Ordinance 2019, promulgated on 20th September 2019, the Company intends to exercise the option permitted u/s 115BAA of the Income Tax Act, 1961 to compute income tax at the revised rate (i.e. 25.17%) from current financial year and accordingly has re-measured the current/deferred tax and the consequential effect has been fully recorded in the current period. Additional income tax expense of ₹ 80.21 Cr and ₹ 126.73 Cr has been recognized for the quarter and half year ended September 30,2019 respectively.
Executive Director’s Comments:
Commenting on the results, Arun Alagappan, Executive Director, stated “In Q2 of FY 20, we were able to register a growth of 7% in our disbursements over Q2 of FY 19, in spite of the severe
slowdown in the market. The growth in AUM was over 20%. In Vehicle Finance, since there was slow down in commercial vehicle space, we increased our focus on the refinance and passenger vehicle segments to sustain our growth momentum. With recent government announcements as well as slew of festive season offers, we hope the volumes improve in the next few months. In the Home Equity and the Home Loan businesses we were able to deliver steady growth and we are positive on the business outlook for the rest of the year.”