Reliance Capital Q4 net profit up 53% to Rs 407 cr

Increased profits due to stake sale of asset management business

Leading private sector financial services company, Reliance Capital posted a 53% increase in net profit for the fourth quarter ended March 31, 2015 at Rs 407 crore. The increased profits were primarily due to the stake sale of their asset management business.

“In this quarter we did part of our stake sale of our asset management business. So some profits came from there. The other businesses also showed profits. The stake sale contributed to about Rs 200 crore,” said Sam Ghosh, CEO of Reliance Capital.

Nippon Life acquired 9% stake in Reliance Capital Asset Management for Rs 657 crore and raised stake to 35% in February 2015. The Rs 200 crore was taken in the business while the balance was used for provisions for marked-to-market adjustments in the media business.

In the fourth quarter ended March 31, 2015 the total income of the company was up by 37% to Rs 2,527 crore.

The profits before tax of Reliance Capital Asset Management for the fourth quarter ended March 31, 2015 stood at Rs 126 crore compared with Rs 124 crore in the same quarter a year ago. The profit before tax of Reliance Commercial Finance stood at Rs 151 crore in the fourth quarter compared with Rs 145 crore in the same period a year ago.

The fourth quarter profit before tax of Reliance General Insurance was 18 crore compared with Rs 12 crore in the same period a year ago. However, the profit before tax of Reliance Life Insurance for the fourth quarter of previous fiscal fell to Rs 87 crore compared with Rs 100 crore in the same period a year ago.

“The Non Performing Assets (NPA) levels are slightly higher in commercial finance business due to which profits have not gone up significantly. The gross NPA levels are at 2.2% compared with 2% last year,” said Ghosh.

For the fiscal ended March 31, 2015 Reliance Capital posted a 34% increase in net profit to Rs 1,001 crore. The total income was up by 17% to Rs 8,861 crore in the same period.

“All our businesses are profitable and the profits will be better going forward,” said Ghosh.