Mumbai: L&T Finance Holdings (LTFH) on Sunday reported a consolidated net profit of ₹548 crore in the March quarter of FY19, 94% higher than the same quarter of the previous year. For the full year, the non-banking financial company’s (NBFC) consolidated profit after tax (PAT) stood at ₹2,226 crore, a growth of 77% from ₹1,255 crore in FY18.
While the lender’s total assets grew 17% year-on-year (y-o-y) in FY19, its wholesale finance book, which accounts for 48% of its total assets, shrunk 1% to ₹47,178 crore. The rest of the asset book – rural finance and housing finance – grew 50% y-o-y and 34% y-o-y, respectively.
LTFH said in a statement that through its subsidiaries, it has around ₹1,800 crore exposure to six project special purpose vehicles (SPVs) of Infrastructure Leasing & Financial Services (IL&FS). It added that the resolution plan submitted by the government (at the instance of IL&FS board) to National Company Law Appellate Tribunal (NCLAT), specifies that these SPVs are capable of servicing loans to secured creditors and there will be priority on payments towards them.
“As on 31 March, 2019, the exposure as secured financial creditor to these SPVs, is in the stage one category and within the standard classification of RBI's prudential norms. This substantiates our view that there will be no provision required towards principal repayment," the NBFC said.
It added that as a measure of commercial prudence and taking a conservative view, it has reversed ₹84 crore towards interest of Q3 FY19 and Q4 FY19. “Without this deferment, the PAT and the return on equity (RoE) for FY19 would have been ₹2,285 crore and 18.38%, respectively. Similarly, the PAT and the RoE for Q4 FY19 would have been ₹607 crore and 18.32%, respectively," the statement said.
The NBFC said it has raised funds through secured retail non-convertible debentures (NCD) issues, aiding in the retailisation of its liabilities. It has raised ₹1,500 crore in tranche one and ₹1,000 crore in tranche two.