Mumbai: Mahindra and Mahindra (M&M) Financial Services Ltd on Wednesday reported a 28.4% fall in its consolidated net profit for the quarter ended 30 September on higher provisions.
Net profit fell to ₹ 157.11 crore from ₹ 219.35 crore a year ago.
A Bloomberg poll of three analysts had estimated profit of ₹ 207.50 crore. Total income stood at ₹ 1,578.90 crore, up 7.6% from a year ago.
Loan provisions and write off for the quarter jumped 54% to ₹ 291.95 crore as against ₹ 189.67 crore a year ago.
The company said the jump in loan provisions was because of an additional provision of ₹ 61 crore made to meet the Reserve Bank of India’s (RBI’s) revised prudential norms issued in March 2015.
“The company follows prudential norms for income recognition asset classification and provisioning for non-performing assets as prescribed by RBI for NBFCs (non-banking financial companies) and has also been making additional provisions on a prudential basis. The cumulative additional provision over the prevailing RBI norms is at ₹ 705 crore”, the company said in a notice to BSE.
The board approved raising ₹ 1,000 crore by issuing non-convertible debentures.
At 2.39pm, shares of M&M Financial Services fell 1.5% to ₹ 238.40 on BSE, while the benchmark Sensex fell 0.04% to 27,296.33 points.
