Mahindra and Mahindra Financial Services is eyeing a 20% annual growth in disbursements after posting strong numbers for Q1 FY19, Ramesh Iyer, vice president and chairman, said on Wednesday.
Mahindra and Mahindra Financial Services is eyeing a 20% annual growth in disbursements after posting strong numbers for Q1 FY19, Ramesh Iyer, Vice Chairman and Managing Director, said on Wednesday. Net profits rose 33.62% year-on year to Rs 269.05 crore in Q1FY19 on the back of an increase in sales of 28.56% to Rs 1925.84 crore. The company has seen revenue growth rates increasing on a sequential basis over the last five quarters.
Iyer said the company’s business model has been tested a couple of years back when infrastructure spending was low and the monsoon was sub-par. Moreover, the Reserve Bank of India (RBI) had directed NBFCs to migrate to the 90 days past due (dpd) regime for recognition of non-performing assets (NPAs).
“The current scenario is a lot more positive, the monsoon has been good, buoyancy is very high and there is also a spurt in infrastructure spending,” Iyer said. In Q1FY19, the company’s NPAs were Rs 5,534 crore; this compares with Rs 7,049 crore in Q1FY18 and Rs4,415 crore in Q1FY17. As a share of the portfolio, gross NPA ratio in Q1FY19 stood at 9.4%, lower than 14.5% in Q1FY18 and 10.7% Q1FY17.
“We are looking for resolutions,” Iyer said. He added that despite the RBI’s 90-day directive, the company improved gross NPAs by at least 4% over the last year.
The company offers a range of loan products including loans for tractor purchases and homes.
By Utsav Saxena