JM Financial reports 6.12% growth in Q4 revenue

Mumbai: JM Financial on Wednesday reported a 6.12 per cent rise in total income at Rs 840.58 crore for the January-March quarter against Rs 792.11 crore recorded for the comparable year-ago period.

The company reported a 7.64 per cent drop in March quarter profit after tax and before controlling interest compared with Rs 176.45 crore reported for the year-ago period.

However, consolidated net profit after tax, non-controlling interest and share of associates stood at Rs 130.56 crore, up 1.5 per cent from Rs 128.64 crore posted for the same period a year ago.


The company has made a provision of Rs 175 crore on account of the uncertainties around the impact of Covid-19,
For the full year, consolidate net profit declined 4.75 per cent to Rs 545 crore, while revenue slipped a marginal 1.3 per cent to Rs 3,453.55 crore.

The company also recommended a dividend of Re 0.20 per share, and said the lower dividend is on account of uncertainties of Covid-19.

The major impact of Covid-19 in the financial statements is captured in expected credit loss and fair value of investments, the company said in a release pointing to the gross provision of Rs 175 crore.

“The last 18 months have been challenging for financial services, and especially for the NBFC sector, due to the stressed credit environment and slow economic growth,” said Vishal Kampani, managing director of JM Financial Group.

He pointed that the situation has worsened on account of the pandemic and subsequent lockdowns across the country.

On its mortgage lending business, Kampani said he believes the residential sales will continue to be under pressure due to uncertainty among prospective buyers about the economy and the path to recovery.

Commercial real estate and retail sectors will also be impacted due to the lockdown.

“The next six to twelve months continue to be uncertain in light of the current lockdown situation and uncertainty around the Covid-19 crisis,” he said.

“We would remain cautious in our underwriting of new transactions and would continue to support our existing clients to provide financial closures for ongoing projects,” he added.

On the company’s distressed credit business, Kampani said that while Covid-19 may not have a direct impact, the evolving global and domestic economic slowdown will impact demand and realisations.

“The cash flows of our business depends on the cash flows of companies which we have lent to and hence these could be impacted based on the sector exposure,” he said.