SREI Infra's consolidated net profit falls 68.3%

Loss on forex transactions, higher borrowing cost impact earnings

SREI Infrastructure Finance said on Friday its consolidated profit after tax for the quarter ended September 30, fell 68.3 per cent from a year earlier to Rs 41.24 crore, as it incurred a loss on foreign exchange transactions. Higher borrowing cost without a corresponding increase in yield on advances also impacted earnings during the three-month period.

“The approach has been cautious this year; therefore, we have not been growing the disbursements but focused on asset quality. We see that in the next one year, there will continue to be uncertainties in the economy and also infrastructure sector. It is a good strategy to concentrate on consolidation,” said Hemant Kanoria, chairman and managing director, in his post-earnings comments.

The total consolidated asset under management increased to Rs 34,754 crore by September 30, from Rs 34,483 crore a quarter earlier.

Consolidated disbursement during the quarter was Rs 2,401 crore. The infrastructure finance company’s consolidated total income from operations during the second quarter increased to Rs 808.04 crore from Rs 775.27 crore a year ago.

Srei incurred a loss of Rs 15.95 crore on foreign exchange transactions in the July-September period, compared to a profit of Rs 22.30 crore in the corresponding period of the previous year.

“The strategic investment portfolio of the company operationally has been performing well, and we expect to realise some of the investments. As the government has now allowed unlisted companies to list overseas, we are also exploring some opportunities through this route, which can augment the resources in near future,” said Kanoria.