Consolidated Loan Assets Under Management increased by

Consolidated Loan Assets Under Management increased by
16% YoY at Rs.46,501crs

Consolidated Profit after Tax increased by 52% YoY at Rs.858crs

Standalone Loan Assets Under Management increased by 15% YoY at Rs.41,296 crs for Q1 FY21

Standalone Profit after tax increased by 59% YoY at Rs.841crs for Q1 FY21

Consolidated Results of Muthoot Finance Ltd

Muthoot Finance Ltd Consolidated Loan Assets under management achieved a YoY increase of 16% at Rs.46,501crs as at Q1 FY21 as against last year of Rs.40,228crs. During the quarter, Consolidated Loan Assets under management decreased by Rs.370crs. Consolidated Profit after tax achieved a YOY increase of 52% of Rs.858 crs as against last year of Rs.563crs.

	Q1 FY21	Q4 FY20	QoQ %	Q1 FY20	YoY %	FY20
Group Branch Network	5,330	5,330	0%	5,092	5%	5,330
Consolidated Gross Loan Assets of the Group (Rs. In crores)	46,501	46,871	-1%	40,228	16%	46,871
Consolidated Profit of the Group (Rs. In crores)	858	836	3%	563	52%	3,169
Contribution in the Consolidated Gross Loan Assets of the Group
Muthoot Finance Ltd	40,906	41,216	-1%	35,406	16%	41,216
Subsidiaries	5,595	5,655	-1%	4,822	16%	5,655
Contribution in the Consolidated Profit of the Group
Muthoot Finance Ltd	834	809	3%	522	60%	2,993
Subsidiaries	23	27	-15%	41	-44%	176

Standalone Results of Muthoot Finance Ltd and its subsidiaries

Muthoot Finance Ltd (MFIN), the largest gold financing company in India in terms of loan portfolio, registered an increase in net profit of 59%, at Rs.841crs for Q1FY21 as against Rs.530crs for Q1 FY20.  Loan Assets stood at Rs.41,296crs compared to Rs.35,816crs previous year, Y-o-Y growth of 15%. During Q1 FY21, Loan Assets decreased by Rs.315crs on account of closure of branches during the month of April 2020 due to pan India lockdown announced by Govt. Of India in the wake of Covid-19 pandemic.

Muthoot Homefin (India) Ltd (MHIL), the wholly owned subsidiary, loan portfolio decreased to Rs.1,979 crs as against previous year of Rs.1,988crs, a YoY decrease of 0.40%. During Q1 FY21, loan portfolio increased by Rs.2crs. Total revenue for Q1 FY21 stood at Rs.59crs as against Rs.62crs in the previous year. It achieved a profit after tax of Rs.0.41crs in Q1 FY21 as against Rs.6crs in the previous year. Its Stage III Asset on Gross Loan Asset % as on June 30, 2020 stood at 1.70%. Company also made a Covid ECL provision of Rs.13crs additionally.

M/s. Belstar Microfinance Limited (BML), an RBI registered micro finance NBFC and Subsidiary Company where Muthoot Finance holds 70.01% stake, grew its loan portfolio to Rs.2,575crs as against last year of Rs. 1,939crs, a YoY increase of 33%. During Q1 FY21, loan portfolio decreased by Rs.56crs. It achieved a profit after tax of Rs. 15crs in Q1 FY21 as against Rs. 23crs previous year. Its Stage III Asset on Gross Loan Asset % as on June 30, 2020 stood at 1.11%. Company also made a Covid ECL provision of Rs.6.83crs additionally.

Muthoot Insurance Brokers Pvt Limited (MIBPL), an IRDA registered Direct Broker in insurance products and a wholly owned subsidiary company generated a total premium collection amounting to Rs. 44crs in Q1 FY21 as against Rs. 61crs in the previous year. It generated a Profit after Tax of Rs. 4crs in Q1 FY21 as against Rs. 3crs in the previous year.

The Sri Lankan subsidiary- Asia Asset Finance PLC(AAF) where Muthoot Finance holds 72.92% stake, increased its loan portfolio to LKR 1,348crs as against LKR 1,290crs last year, a YoY increase of 4%. During Q1 FY21, loan portfolio decreased by LKR 36crs.Total revenue for Q1 FY21 stood at LKR 70crs as against previous year total revenue of LKR 80crs.It incurred a loss of LKR 2crs in Q1FY21 as against previous year profit after tax of LKR 3crs.

Muthoot Money Ltd (MML), became a wholly owned subsidiary of Muthoot Finance Ltd in October 2018. MML is a RBI registered Non- Banking Finance Company engaged mainly in extending loans for vehicles. Recently, Company has started extending loans for Commercial Vehicles and Equipments. Its loan portfolio stood at Rs.497 crs as on June 30 ,2020. During Q1 FY21, loan portfolio decreased by Rs.12crs. Total revenue for Q1 FY21 stood at Rs.20 crs. Company also made a Covid ECL provision of Rs.12.19crs additionally.

Management Quote

Commenting on the results M G George Muthoot, Chairman stated, “At a time when pandemic has disrupted business activities across the globe, we with the support of our employees, customers and lenders have been able to continue excellence in our performance.  Company could achieve a 59% YoY increase in profit after tax of Rs.841crs for the quarter. Our branches were completely shut during the month of April due to nationwide lockdown. To ensure business continuity we upscaled our digital platforms. We recorded four-fold jump in digital loan disbursals since then. To encourage digital usage, we are incentivizing our customers with a cashback scheme to service interest payments through our online platforms. With businesses resuming, we have witnessed surge in gold loans as it is the most convenient form of availing working capital for small business and traders to kickstart their businesses.”

Speaking on the occasion George Alexander Muthoot, Managing Director said, “Our disbursements during the quarter was lower on account of closure of branches in the month of April 2020 due to nationwide lockdown. Once the branches opened, we saw higher level of repayments than disbursements, probably, on account of restrictions in movement of people. However, we witnessed a significant increase in disbursements since June 2020 which continues in July and August 2020. As initially guided, we are looking forward to achieve a 15% growth in gold loan portfolio for FY 21. Company also maintained a liquidity buffer of Rs.8,477crs as cash, bank and investments in liquid funds as on June 30 ,2020. Non-gold loan portfolio in subsidiaries constituted about 12% of consolidated loan portfolio. Collections in non-gold loan portfolio have significantly improved month on month. Additional Covid ECL provisions to the extent of Rs.32crs were made for non-gold loan portfolio in the quarter.”

Financial Highlights (MFIN):

	Q1 FY21	Q4 FY20	QoQ %	Q1 FY20	YoY %
	(Rs.in Crs)	(Rs.in Crs)	Change	(Rs.in Crs)	Change
Total Income	2,385	2,403	-1%	1,859	28%
Profit Before Tax	1,125	1,097	3%	817	38%
Profit After Tax	841	815	3%	530	59%
Earnings Per Share(Basic) Rs.	20.96	20.33	3%	13.23	58%
Loan Assets	41,296	41,611	-1%	35,816	15%
Branches	4,573	4,567	0%	4,502	2%

Particular	Q1 FY21	Q4 FY20	Q1 FY20
Return on Average  Loan assets	8.11%	8.13%	6.05%
Return on Average Equity	28.16%	28.39%	21.70%
Book Value Per Share (Rs.)	306.99	288.43	243.02

Particular	Q1 FY21	Q4 FY20	Q1 FY20
Capital Adequacy Ratio	26.30	25.47	24.72
Share Capital & Reserves (Rs. in Crs)	12,316	11,572	9,743

Business Highlights (MFIN):

Particular	Q1 FY21	Q1 FY20	Growth (YoY)
Branch Network	4,573	4,502	2%
Gold Loan Outstanding (Rs. in Cr)	40,495	35,171	15%
Credit Losses (Rs. in Cr)	3	2	40%
% of Credit Losses on Gross Loan Asset Under Management	0.0069%	0.0068%	1%
Average Gold Loan per Branch (Rs. In Cr)	8.86	8.24	8%
No. of Loan Accounts (in lakh)	76	82	-7%
Total Weight of Gold Jewellery pledged (in tonnes)	165	176	-6%
Average Loan Ticket Size	53,426	42,705	25%
No. of employees	25,430	24,644	3%

Profit after tax for Q1FY21 at

-Profit after tax for Q1FY21 at Rs 228 Cr* (up 26% y-o-y and 5% q-o-q)

-Income for Q1FY21 at Rs 673 Cr (up 10% y-o-y and down 1% q-o-q)

 For the quarter ended June 30, 2020 (Q1FY21), consolidated results as per IND AS are:

·      Profit before tax (excluding Covid related provision and other exceptional items*) stood at Rs 322 Cr for the quarter, up 25% y-o-y and 9% q-o-q

·      Profit after tax (TCI) (excluding Covid related provision and other exceptional items*) stood at Rs 228 Cr for the quarter, up 26% y-o-y and 5% q-o-q

·      Consolidated income stood at Rs 673 Cr for the quarter, up 10% y-o-y and down 1% q-o-q

·      Loan assets under management stood at Rs 38,335 Cr, up 10% y-o-y and 1% q-o-q

IIFL Finance Limited Consolidated Results – Q1FY21

Rs Crore	Quarter ended  June 30, 2020	Quarter ended June 30, 2019	Y-O-Y	Quarter ended March 31, 2020	Q-O-Q
Income (Net)	672.6	610.7	10%	682.9	(1%)
Prior to Covid provision and other exceptional items:
Profit before tax	322.1	256.8	25%	296.6	9%
Profit after tax (TCI)	228.2	180.9	26%	216.5	5%
Post Covid provision and other exceptional items:
Profit before tax	57.3	256.8	(78%)	14.6	293%
Profit after tax (TCI)	30.1	180.9	(83%)	54.8	(45%)

*Q1FY21 exceptional items comprise COVID-19 provision of Rs. 194 Cr and Rs. 70 Cr MTM loss on forex borrowings and hedge. As our forex loans are fully hedged, the accounting gain/loss will even out by maturity of the bonds. Q4FY20 consists of COVID-19 provision of Rs. 282 Cr. Besides, in Q4FY20, provision for tax includes reinstatement of deferred tax reversal of Rs. 49 Cr post merger

Mr. Nirmal Jain, Chairman, IIFL Finance Ltd., commented on the financial results: “Amidst uncertainty and work from home being imperative, IIFL Finance has delivered satisfactory results. We are really proud of our employees, who despite Covid related challenges have not missed a beat in servicing the customers. The Company’s core strategy hinges upon its steadfast focus on retail lending and digitization of end to end processes, to minimize cost and maximize employee productivity and customer experience. Liquidity is improving. Work and life are slowly getting back to normalcy. The proportion of customers under moratorium is falling. In this backdrop, we look at steady improvement in business environment for NBFCs. Our business plan this year is to focus on productivity and asset quality to fortify the foundation for future growth.”

IIFL Finance had loan assets under management of Rs 38,335 Cr as at June 30, 2020, with the home loans segment constituting 33%, business loans 21%, gold 25% and microfinance 8% of the total AUM.

The company’s annualized ROE and ROA for Q1FY21 stood at 19.5% and 2.7% respectively (excluding exceptional items). Average borrowing costs for the quarter decreased by 10 bps q-o-q to 9.3%.

88% of our loans are retail in nature and 43% are PSL compliant. The assigned loan book, currently at
Rs 9,985 Cr, is 26% of AUM. There exists significant opportunity for further assignment, given our granular and retail book.

GNPA stood at 1.95% and NNPA stood at 0.86%, as at June 30, 2020. With implementation of Expected Credit Loss under IndAS, provision coverage on NPAs stands at 183% including standard asset coverage. Provision coverage excluding the additional provision made for Covid impact stands at 101%

Loans under moratorium have fallen from 60% as at end of May 2020 to 31% as at end June 2020. The Company has offered second moratorium to all its customers on an opt-in basis.

Total CAR stood at 19.3% including Tier I capital of 15.3% as at June 30, 2020, as against statutory requirement of 15% and 10% respectively.

The total presence of branches stood at 2,372 as at the end of quarter, spanning the length and breadth of the country.

Home Loans

At the end of the quarter, retail home loan assets stood at Rs 12,618 Cr. The primary focus in this segment is on affordable and non-metro housing loans. About 38,300 customers were benefitted with a subsidy of about Rs 900 Cr under the Pradhan Mantri Awas Yojana – Credit Linked Subsidy Scheme.

Gold Loans

As of June 30, 2020 the gold loans AUM grew to Rs 9,490 Cr, showing a strong growth of 44% y-o-y. Gold loans are provided through our widespread presence in 600+ cities across 25 states to salaried, self-employed and MSME customer segments. 

Microfinance

The microfinance business continued its steady growth, with the loan AUM growing 37% y-o-y to           Rs 3,222 Cr as at June 30, 2020. The microfinance customer base increased to over 15 lakh customers.

Credit Rating

IIFL’s long term rating stands at AA (Negative) as on date.

Liquidity Update

During the quarter, we raised Rs 1,005 Cr through term loans and refinance from banks. Loans of Rs 877 Cr were securitized/assigned during the quarter. Cash and cash equivalents and committed credit lines from banks and institutions of Rs 3,745 Cr were available as on June 30, 2020.

Awards and Accolades:

·         IIFL Finance received the ‘Golden Peacock National Training Award – 2020’

·         IIFL Finance received the 'Most Admired Service Provider in Financial Sector' at the ET Now World BFSI Awards

·         IIFL Finance featured in ‘India’s Best Workplaces in BFSI 2020’ – Top 25 list

·         The Economic Times recognizes our Chairman as one of the 'Most Promising Business Leaders of Asia' for demonstrating exemplary leadership qualities

·         IIFL Home Finance won the ‘Best Housing Finance Company’ & the ‘Best Affordable Housing Finance Company’ of the Year by ET NOW

·         IIFL Finance received the ‘Golden Peacock Award for Risk Management’ 2019 from the Institute of Directors at Singapore Global Convention on Board Leadership & Risk Management