Muthoot Capital records fall in net profit for Q1

KOCHI: Muthoot Capital Services Ltd. recorded a 30 per cent fall in the net profit at Rs 3.75 crores for the quarter ended June 2015, compared with that a year ago. However, the total income at Rs 50.65 crore was higher by 12.06 per cent.

An official statement of the company attributed the fall in net profit to the higher rate of increase in expenses contributed mainly by the increase in provisions, compared to the increase in revenues.

The Company disbursed 36734 loans amounting to Rs 165.72 crores during the quarter compared to 29902 loans amounting to Rs.122.56 crores during the same quarter last year.

"The Company’s aim is to consolidate its position as a national player in two wheeler financing segment. While the business and income have been growing, the reduction in net profit is on account of the 5 month norm for NPA and 0.30 per cent standard asset provisioning adopted by the company from the first quarter itself," said Thomas George Muthoot, managing director, Muthoot Capital Services Limited.

The two wheeler finance major in South India is planning an aggressive foray into the North Indian States as part of company's pan India expansion. It plans to tap the huge potential available for two wheeler financing products in northern states starting with Delhi, Rajasthan and Punjab. The company also has plans to expand its operations to the eastern part of India in the later part of the year.

"The immediate focus is going to be NPA reduction, aiming at substantial improvement by the end of the current quarter. With aggressive strategies adopted for reducing the NPA, the financial performance of the company will improve," R.Manomohanan, chief executive officer of the Company said.