The Indiabulls Finance Centre, developed by Indiabulls Real Estate Ltd., stands in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

Q4 Results: Indiabulls Housing Finance’s Profit Dips, Misses Estimate

Indiabulls Housing Finance Ltd.’s profit for the March-ended quarter missed estimates.

Net profit fell 6.9 percent year-on-year to Rs 1,001 crore, the company said in its regulatory filing. That compares with the Rs 1,183-crore consensus estimate of the analysts tracked by Bloomberg.

The non-bank lender generated net interest income of Rs 1,835 crore, a 1.1 percent dip from the previous year, but higher than the analysts’ estimate of Rs 1,600 crore.

Gross bad loans at the end of the March quarter stood at Rs 1,061 crore which is 0.88 percent of the total loan assets compared to 0.78 percent a year ago.

“The company has raised more than Rs 50,000 crore in the last six months, which is by far the highest for the proportion of balance sheet in the non-bank space,” Ashwini Kumar Hooda, deputy managing director of Indiabulls Housing Finance told BloombergQuint. “We are sitting on a very comfortable liquidity of more than 31,000 crore.”

The company, he said, has about Rs 10,000-11,000 crore extra cash in the balance sheet, which it would use for growth purposes.

Other Key Highlights

  • The lender’s outstanding loans stood at Rs 1.21 lakh crore.
  • Net NPAs were at 0.69 percent against 0.59 percent in the preceding quarter.
  • Commercial paper borrowings were down to 4 percent from 12 percent a year ago.
  • Spreads, or difference between interest rate that a lender charges a borrower and the rate a lender pays a depositor, was at 3.42 percent compared with 3.11 percent a year ago.
  • Cost of funds were at 8.73 percent against last years’s 7.75 percent.
  • Disbursements dropped 65 percent year-over-year.

Indiabulls Housing Finance proposed to merge with Lakshmi Vilas Bank earlier this month. Under the agreement, which is yet to receive the Reserve Bank of India’s nod, shareholders of Lakshmi Vilas Bank would get 14 shares of Indiabulls Housing Finance for every 100 shares.

Also read: How Brokerages View Indiabulls Housing Finance-Lakshmi Vilas Bank Merger

“The regulatory process is underway,” Hooda said, adding that the merger process would take about six to nine months. While there is no definite timeline to the procedure, Hooda expects the RBI’s approval in the next three to four months. “Everything is on track.”

Declares Interim Dividend

The lender declared an interim dividend of Rs 10 per equity share having a face value of Rs 2 each. It fixed May 8 as the record date for determining names of eligible members for receipt of the interim dividend. The dividend will be paid on or before May 23.

The company, in a separate filing, said its board had authorised it to issue secured non-convertible debentures and unsecured, redeemable, non-convertible subordinate debt as debentures of up to Rs 25,000 crore and Rs 1,000 crore, respectively, on private placement basis, in one or more tranches, from time to time.

Shares of the company rose 0.47 percent to close at Rs 748.80 apiece ahead of the earnings announcement.

Also read: Indiabulls Housing Finance Plans Rs 26,000-Crore Borrowing This Fiscal

Watch the full interview here: