Muthoot Capital Services (MCSL), the vehicle financing firm of Muthoot Pappachan group, has reported a profit after tax (PAT) of Rs 20.13 crore in the second quarter of 2018-2019 despite business fluctuations in August due to devastating floods in one of its main markets. The company’s PAT surged 94.2% in Q2, from Rs 10.37 crore in the corresponding quarter in 2017-2018. The total AUM (asset under management), reached Rs 2,515.23 crore at the end of the quarter, including securitised portfolio of Rs 422.73 crore, according to unaudited results approved by the board of directors this week.
“But for the phenomenal floods in Kerala, we could have perhaps disbursed Rs 52 crore more credit, done 20% more business and posted Rs 24 crore net profit in Q2. However, due to MCSL’s growing presence across the country, the lacklustre Onam season in our main market did not have much of an impact on our growth trajectory. What helped the surge in net profit was 70% growth (Y-o-Y) in non-South disbursements,” Madhu Alexiouse, COO of Muthoot Capital, told FE.
The company’s business grew 75% in the west, 200% in the east and 63% in the northen region through its sibling firm Muthoot Fincorp and its dealer network. “Currently, we have 60 dealers in Mumbai alone, apart from 200 dealers in rest of Maharashtra,” says Alexiouse. As floods wrecked havoc in Kerala, MCSL offered a deferred instalment payment option in August, waiving the penal interest for flood-affected districts. “We feared about Rs 15-20-crore growth in our NPAs because of this. This did not happen. Our NPA , as on September 30, was about Rs 12 crore. By September, about 80% creditors paid up, affirming our choice of clientele,” says CFO Vinod Panicker.
MCSL’s total income stood at Rs 132.03 crore, reflecting a growth of 39.5% over last year’s Rs 94.65 crore. The company had made total disbursement of Rs 541.75 crore during the quarter under review, against Rs 477.23 crore for the corresponding quarter in the previous year.