L&T Finance Holdings on Wednesday reported a consolidated net profit of Rs 182 crore for the quarter ended December 2014, up 66% from Rs 110 crore in the same period last year on account of an improved net interest margin.
The firm’s asset quality deteriorated in Q3 with net non-performing assets (NPAs) rising 5% sequentially to Rs 863.3 crore and gross NPAs at Rs 1,326.5 core, up 8% q-o-q. The firm’s investment management business saw the average assets under management (AAUM) growing 25% y-o-y to Rs 21,336 crore.
The net interest margin (NIM) was at 5.66% in Q3 compared with 5.23% in the same quarter last year and the advances grew 20% y-o-y to Rs 45,225 crore compared with Rs 37,820 crore in the same period last year.
L&T Finance Holdings chairman and managing director YM Deosthalee said in a statement that steady margins, supported by a healthy fee income stream and stable operating expenses helped the company.
“We have been able to report a consistent growth in assets on the back of a strong and nimble lending franchise with the ability to choose growth areas across multiple product lines and customer segments. We expect a gradual and steady improvement in returns,” Deosthalee added.
The company believes the impact of policy decisions and reform measures being undertaken by the government is expected to be visible on the ground only by the first half of next fiscal. “We expect a healthy asset growth of around 20% in the current financial year. We expect a consistent and steady improvement in the return metrics supported by the ability to maintain current margins, healthy stream of fee income, stable operating expense ratios and improvement in asset quality,” the company said in the statement.
Shares of L&T Finance closed 1.24% up at Rs 69.50 on BSE on Wednesday.
