Shriram Transport Finance’s Q4 profit slumps 70% on Covid provisioning

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June 11, 2020 7:13 AM

Shriram Transport’s total income in the March quarter stood at Rs 4,173 crore, up 7% from Rs 3,883 crore in the same period last year. The net interest income (NII) for the March quarter in financial year 2020 remained flat at Rs 1,918 crore, against Rs 1,902 crore in the same period of the previous year.

Shriram Transport’s total income in the March quarter stood at Rs 4,173 crore, up 7% from Rs 3,883 crore in the same period last year.

The commercial vehicle financier Shriram Transport Finance’s net profit for the March quarter fell 70% year-on-year (y-o-y) to Rs 223 crore due to provisions of Rs 910 crore related to Covid-19. The company said that the negative impact of Covid-19 pandemic will be reflected in the turnover and profitability of the company for the financial year (FY) 2021. “The level of the same cannot be ascertained at present, ” the company further said.

Shriram Transport Finance, however, warned of an increase in the expected credit losses (ECL) on its lending business. “The company expects increase in ECL due to extension of moratorium granted to its borrowers based on the regulatory requirements and impact of Covid-19 on the overall economy,” the company said.

Shriram Transport’s total income in the March quarter stood at Rs 4,173 crore, up 7% from Rs 3,883 crore in the same period last year. The net interest income (NII) for the March quarter in financial year 2020 remained flat at Rs 1,918 crore, against Rs 1,902 crore in the same period of the previous year. The company’s finance costs were at Rs 2,159 crore, compared to Rs 1,888 crore in the same period last year.

Total assets under management (AUM) as on March 31, 2020 stood at Rs 1,09,749 crore, compared to Rs 1,04,482 crore as on March 31, 2019. “Our liquidity position has been adversely impacted, as, we have extended moratorium to our borrowers based on notification issued by Reserve Bank of India (RBI),” the company said in its release. In spite of tight liquidity position, our ability to service debts and other financial debt commitment has not been affected as our financial leveraging is low, the company further said.

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