Repco Home Finance Q4 Review - Asset Quality Surprises Positively; Loan Growth Remains Muted: Motilal Oswal
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Motilal Oswal Report
Repco Home Finance Ltd.'s profit after tax fell 21% QoQ to Rs 632 million (27% miss) in Q4 FY21.
While net interest income was in line, profit after tax miss was due to higher operating expenses (up 18% YoY, led by corporate social responsibility expenses and improvement in business volumes) and credit cost (on greater provision cover on S1/S2 loans in anticipation of higher restructuring).
Performance in Q4 FY21 was characterised by healthy net interest margin of 4.8%, sharp decline in gross non performing asset (down 60 basis point QoQ and YoY), and pick-up in disbursements (up 6% YoY).
Balance transfers will remain pronounced in the near future.
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