L&T Finance net jumps 66% on fee income, advances growth

L&T Finance Holdings today reported a 66 per cent jump in consolidated net profit at Rs 182 crore in the three months to December, driven by a 20 per cent rise in advances.
The good numbers were enabled by healthy net interest margins on the back of high yielding assets and effective management of borrowing costs, the non-banking financial services arm of engineering major L&T said in a statement.
Increase in fee income from financial advisory services in renewable power segment and stable operating expenses also aided growth in profit, it said.
The company had a consolidated net profit of Rs 109.68 crore for the quarter ended December 31, 2013.

Total income increased to Rs 1,611.52 crore for the quarter ended December 31, 2014, from Rs 1,308.05 crore in the year ago period, the company said in a BSE filing.
Advances grew 20 per cent Y-o-Y to Rs 45,225 crore from Rs 37,820 crore on a strong disbursement growth of 32 per cent across B2C products, tractors, two wheelers, housing and microfinance in the retail space and operational projects in renewables, roads and non-infrastructure segments in the wholesale business, it said.

Commenting on the financial performance, company Chairman and Managing Director Y M Deosthalee said, "Steady margins, supported by a healthy fee income and stable operating expenses, have helped achieve a 66 per cent spike in net profit growth.

"We have been able to report a consistent growth in assets on the back of having 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," he added.
The city-headquartered lender's investment management business continued to perform well by snapping up equity assets on improved gross and net sales.
Its equity assets rose by 57 per cent to Rs 7,428 crore, comprising 35 per cent of the total average AUM; while the overall AUM expanded by 25 per cent to Rs 21,336 crore.

Asset quality marginally deteriorated with gross NPAs rising to 3.01 per cent from 2.96 per cent from the September quarter, while net NPAs improved to 1.98 per cent from 2 per cent in the July-September period.
The company has increased its provision coverage to 35 per cent on a consolidated level and accordingly the company carries a Rs 190 crore provisions in excess of the RBI norms.
On the business outlook, he said the company expects to achieve a healthy asset growth of around 20 per cent for the full fiscal.