Q -4 Performance Highlights:
Chennai, April 30, 2011: Q4 has been a record quarter for the Company. The surge in Commercial Vehicle Finance business has enabled the Company to grow its disbursements during the quarter.
Vehicle Finance disbursed Rs.1354 Cr. (as against Rs.924 Cr. in Q-4 of 2009 -10) and Home Equity disbursed Rs.326 Cr. (as against Rs.355 Cr. in Q -4 of 2009 – 10). The aggregate disbursements for the quarter is Rs.1680 Cr. (as against Rs.1279 Cr. in Q-4 of 2009 – 10) registering a growth of 31%.
Gross income from operations for the quarter was Rs.342 Cr. significantly higher than Rs.236 Cr. compared to Q -4 of 2009 – 10 registering a growth of 45%. Profit before Exceptional Items is at Rs.53.32 Cr. as against Rs.19.29 Cr. in Q- 4 of 2009 -10 registering a growth of 176%.
Exceptional Items for the quarter of Rs.26.86 Cr. includes impairment provision on investments made in Subsidiary – Cholamandalam Factoring Limited to an extent of Rs.23.99 Cr. and the balance of Rs.2.87 Cr. is on account of standard assets provision created in line with RBI guidelines issued in this regard.
Full Year Performance:
The company has turned out a superior performance and all the Divisions established new records. During the year, the Company focused on
Aggressively growing its asset financing business lines.
Liquidating/collecting its unsecured personal loan portfolio (which had been a drag on profitability).
Improving the profitability
Significantly reducing non performing assets
The efforts have paid off.
Disbursements for the year grew by 48% from Rs.3866 Cr. to Rs.5731 Cr. the highest for the Company since inception.
All the existing business verticals recorded their highest growth / profits since inception. PBT recorded for the year by the Asset financing businesses amounted to Rs.347.63 Cr
While the losses in the Personal Loan portfolio continued, the company has brought down the portfolio to Rs.47 Cr. – a mere 1% of the overall Portfolio as on 31-3-2011, thereby eliminating any further losses on this account in the year ahead. The non performing assets as a % of the portfolio have been significantly brought down.
Financial performance – Summary :
On Balance Sheet Portfolio – (all figures are net of provisions) :
Provisions, Loan Losses and other Charges :
The Company has been making aggressive provisions. A substantial part of the provisions and loan losses related to its unsecured personal loan portfolio. The personal loan book which was at Rs.230 Cr. net of provisions as on 31st March 2010 has been reduced to Rs.47 Cr. as on 31st March 2011. The total amount of provisions, loan losses and other charges for the year was Rs.224.49 Cr. – this includes a sum of Rs.167.77 Cr. towards the personal loan portfolio, constituting 75% of overall loan losses and provisions. With the reduction of Personal loan book size to Rs.47 Cr. as on 31st March 2011, and the probable losses from the portfolio having been fully provided for, the delinquencies relating to the personal loan book have been now fully addressed.
But for the above provisions / loan losses of Rs. 167.77 Cr. towards the personal loan book, the PBT for the year would have been higher by that amount.
The Company has expanded its presence with 226 branches as on 31st March 2011 compared to 171 branches as on 31st March 2010. Most of these branches are in Tier II and Tier III locations across India.
The Securities Business posted a profit before tax of Rs.0.49 Cr. as against a profit of Rs.3.48 Cr. in the previous year, while the distribution / wealth management business posted a profit before tax of Rs.6.90 Cr. as against a profit of Rs.6.89 Cr. in the previous year. Cholamandalam Factoring Limited, made a loss before tax of Rs.8.16 Cr. as against a loss of Rs.8.62 Cr. in the previous year.
The wealth management business has plans for expansion. A senior management team with industry experience has been put in place to explore the cross sell business.
The consolidated profit after tax for the year was Rs.84.58 Cr. as against a PAT of Rs.52.77 Cr. in the previous year.
About Murugappa Group
Founded in 1900, the Rs.13617 Crores (USD 3.03 billion) Murugappa Group is one of India’s leading business conglomerates. The Group has 29 businesses including seven listed Companies actively traded in NSE & BSE. Headquartered in Chennai, the major Companies of the Group include Carborundum Universal Ltd., Cholamandalam Investment and Finance Company Ltd., Cholamandalam MS General Insurance Company Ltd., Coromandel International Ltd., Coromandel Engineering Company Ltd., E.I.D. Parry (India) Ltd, Parry Agro Industries Ltd., Tube Investments of India Ltd., and Wendt (India) Ltd.
Market leaders in served segments including Abrasives, Auto Components, Cycles, Sugar, Farm Inputs, Fertilizers, Plantations, Construction, Bio-products and Nutraceuticals, the Group has forged strong joint venture alliances with leading international companies like Mitsui Sumitomo, Foskor, Cargill, Groupe Chimique Tunisien, Winterthur Technology Group and Morgan Crucible. The Group has a wide geographical presence panning 13 states in India and 5 continents.
Renowned brands like BSA, Hercules, Ballmaster, Ajax, Parry’s, Gromor and Paramfos are from the Murugappa stable. The organization fosters an environment of professionalism and has a workforce of over 32,000 employees.