Q4 Results: Muthoot Capital’s Profit Tumbles On Unrealised Income, One-Time Expense

Muthoot Capital Services Ltd.’s profit for the quarter ended March plummeted 14.7 percent due to unrealised securitisation income and bank processing fee payouts, its Chief Financial Officer Vinod Panicker said.

The financial services company is yet to receive a securitisation income of Rs 366 crore from its special purpose vehicle.

"As per the Reserve Bank of India’s regulations, we are permitted to recognise the income on securitisation transaction only when we receive the money physically from the SPV...This is the single largest reason for the income being lower, which obviously led to the bottom line being lower,” Panicker told BloombergQuint in an interview. The company, he said, also incurred a one-time expenditure of Rs 2.7 crore on the bank processing fee payouts.

Q4 Earnings Highlights (YoY)

• Net interest income rises 6.3 percent to Rs 91.8 crore, from Rs 86.33 crore
• Profit tumbles 14.7 percent to Rs 18.35 crore, versus Rs 21.52 crore
• Provisions increase to Rs 10.85 crore, compared with Rs 10.60 crore

Panicker said that the company had earlier forecast to double its book value by the end of financial year 2020. “We are fairly confident to reach that number by the end of the current financial year,” he said.

Watch the full interview here: