Ujjivan’s Q3 profit drops 9.54% to Rs43.94 crore

Ujjivan Financial’s provisions and contingencies increased to Rs54.74 crore at the end of December quarter from Rs6.95 crore in the September quarter


Shares in Ujjivan lost 2.9% to close at Rs352.10 on Thursday on the BSE, while the benchmark Sensex gained 0.19% to close at 27,308.60 points.
Shares in Ujjivan lost 2.9% to close at Rs352.10 on Thursday on the BSE, while the benchmark Sensex gained 0.19% to close at 27,308.60 points.

Mumbai: Ujjivan Financial Services Ltd on Thursday said profit for the third quarter ended 31 December dropped 9.54% from a year ago because of an increase in provisions.

Net profit fell to Rs43.94 crore in the three months ended 31 December from Rs48.57 crore in the same period a year earlier.

The microfinance industry has been hit severely by the government’s demonetisation drive, which led to a drop in both disbursements as well as collections.

Provisions and contingencies increased to Rs54.74 crore at the end of December quarter from Rs6.95 crore in the September quarter.

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However, net interest income (NII) in the December quarter rose 44% to Rs199 crore from a year ago.

“Ujjivan internally took a conservative call on provisioning; after four to six months, we will get an idea of how much portfolio turns into non-performing assets,” said Sudha Suresh, chief financial officer.

Cost-to-income ratio for the December quarter stood at 49.33% compared to 49.01% in the second quarter ended September.

This compared with 48.18% in the year-ago quarter.

Shares in Ujjivan lost 2.9% to close at Rs352.10 on Thursday on the BSE, while the benchmark Sensex gained 0.19% to close at 27,308.60 points.

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