Repco Home Finance Q1 Review - Restructuring Under OTR 2.0 Stood Elevated: Motilal Oswal
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Motilal Oswal Report
Repco Home Finance Ltd.'s profit after tax fell 50% QoQ and YoY to Rs 321 million in Q1 FY22.
While net interest income was broadly in line, the profit after tax miss was due to higher credit cost (up 2.5 times YoY due to provisions on restructured loans).
Operating profit rose 3% QoQ and 13% YoY to Rs 1.2 billion.
Performance in Q1 FY22 was characterised by a healthy net interest margin at 4.8%, rise in gross non performing asset, incremental restructuring of ~5.1% under Reserve Bank of India one time restructuring 2.0, and ~63% QoQ decline in disbursements, leading to flat assets under management on a QoQ and YoY basis.
For Repco Home Finance, the second Covid-19 wave led to imminent stress and higher restructuring.
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