Muthoot Capital Q4 profit falls 15% YoY to Rs 18 crore

Mumbai: Muthoot Capital’s (MCSL) profit in the March quarter contrived 15% to Rs 18 crore owing to elevated financing costs and slowdown in two-wheeler sales. The NBFC said that it would be looking to raise Rs.1200 crore through loan securitisation over the current fiscal for expanding their loan book.

MCSL, a subsidiary of Muthoot Pappachan group, registered an asset under management (AUM) growth of 22% to Rs.2741 crores of which 85% consists of the two-wheeler portfolio. “Considering that both NBFC and two-wheeler market has gone through major headwinds in the quarter, our results reflect strong business fundamentals,” said Madhu Alexiouse, COO MCSL.

The NBFC will look to expand their loan-book by further 25% in FY20 and has been tapping securitisation market for its short-term funding requirements.


“The bank’s credit costs the NBFCs have been elevated since September,” said Vinod Panicker, CFO MCSL. “We expect the costs to remain high for some time as banks have been choosy in their lending to NBFCs.”

The NBFC in FY19 has raised Rs.837 crore through selling securitised asset to banks and will be looking to raise further Rs.1200 crore over the current fiscal, it said.

“DCB bank has been the main subscriber to our asset portfolios. The cost of securitisation at 9.33% is similar to bank rates for credit, but capital raised through securitisation helps in improving our capital adequacy without additional investment,” Panicker said.