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Consolidated Loan Assets Under Management increased by 16% YoY at Rs.46,501crs

Consolidated Loan Assets Under Management increased by 16% YoY at Rs.46,501crs 1

Consolidated Results of Muthoot Finance Ltd

Muthoot Finance Ltd Consolidated Loan Assets under management achieved a YoY increase of 16% at Rs.46,501crs as at Q1 FY21 as against last year of Rs.40,228crs. During the quarter, Consolidated Loan Assets under management decreased by Rs.370crs. Consolidated Profit after tax achieved a YOY increase of 52% of Rs.858 crs as against last year of Rs.563crs.

 Q1 FY21Q4 FY20QoQ %Q1 FY20YoY %FY20
Group Branch Network5,3305,3300%5,0925%5,330
Consolidated Gross Loan Assets of the Group (Rs. In crores)46,50146,871-1%40,22816%46,871
Consolidated Profit of the Group (Rs. In crores)8588363%56352%3,169
Contribution in the Consolidated Gross Loan Assets of the Group
Muthoot Finance Ltd40,90641,216-1%35,40616%41,216
Subsidiaries5,5955,655-1%4,82216%5,655
Contribution in the Consolidated Profit of the Group
Muthoot Finance Ltd8348093%52260%2,993
Subsidiaries2327-15%41-44%176

Standalone Results of Muthoot Finance Ltd and its subsidiaries

Muthoot Finance Ltd (MFIN), the largest gold financing company in India in terms of loan portfolio, registered an increase in net profit of 59%, at Rs.841crs for Q1FY21 as against Rs.530crs for Q1 FY20.  Loan Assets stood at Rs.41,296crs compared to Rs.35,816crs previous year, Y-o-Y growth of 15%. During Q1 FY21, Loan Assets decreased by Rs.315crs on account of closure of branches during the month of April 2020 due to pan India lockdown announced by Govt. Of India in the wake of Covid-19 pandemic.

Muthoot Homefin (India) Ltd (MHIL), the wholly owned subsidiary, loan portfolio decreased to Rs.1,979 crs as against previous year of Rs.1,988crs, a YoY decrease of 0.40%. During Q1 FY21, loan portfolio increased by Rs.2crs. Total revenue for Q1 FY21 stood at Rs.59crs as against Rs.62crs in the previous year. It achieved a profit after tax of Rs.0.41crs in Q1 FY21 as against Rs.6crs in the previous year. Its Stage III Asset on Gross Loan Asset % as on June 30, 2020 stood at 1.70%. Company also made a Covid ECL provision of Rs.13crs additionally.

M/s. Belstar Microfinance Limited (BML), an RBI registered micro finance NBFC and Subsidiary Company where Muthoot Finance holds 70.01% stake, grew its loan portfolio to Rs.2,575crs as against last year of Rs. 1,939crs, a YoY increase of 33%. During Q1 FY21, loan portfolio decreased by Rs.56crs. It achieved a profit after tax of Rs. 15crs in Q1 FY21 as against Rs. 23crs previous year. Its Stage III Asset on Gross Loan Asset % as on June 30, 2020 stood at 1.11%. Company also made a Covid ECL provision of Rs.6.83crs additionally.

Muthoot Insurance Brokers Pvt Limited (MIBPL), an IRDA registered Direct Broker in insurance products and a wholly owned subsidiary company generated a total premium collection amounting to Rs. 44crs in Q1 FY21 as against Rs. 61crs in the previous year. It generated a Profit after Tax of Rs. 4crs in Q1 FY21 as against Rs. 3crs in the previous year.

The Sri Lankan subsidiary- Asia Asset Finance PLC(AAF) where Muthoot Finance holds 72.92% stake, increased its loan portfolio to LKR 1,348crs as against LKR 1,290crs last year, a YoY increase of 4%. During Q1 FY21, loan portfolio decreased by LKR 36crs.Total revenue for Q1 FY21 stood at LKR 70crs as against previous year total revenue of LKR 80crs.It incurred a loss of LKR 2crs in Q1FY21 as against previous year profit after tax of LKR 3crs.

Muthoot Money Ltd (MML), became a wholly owned subsidiary of Muthoot Finance Ltd in October 2018. MML is a RBI registered Non- Banking Finance Company engaged mainly in extending loans for vehicles. Recently, Company has started extending loans for Commercial Vehicles and Equipments. Its loan portfolio stood at Rs.497 crs as on June 30 ,2020. During Q1 FY21, loan portfolio decreased by Rs.12crs. Total revenue for Q1 FY21 stood at Rs.20 crs. Company also made a Covid ECL provision of Rs.12.19crs additionally.

Management Quote

Commenting on the results M G George Muthoot, Chairman stated, “At a time when pandemic has disrupted business activities across the globe, we with the support of our employees, customers and lenders have been able to continue excellence in our performance.  Company could achieve a 59% YoY increase in profit after tax of Rs.841crs for the quarter. Our branches were completely shut during the month of April due to nationwide lockdown. To ensure business continuity we upscaled our digital platforms. We recorded four-fold jump in digital loan disbursals since then. To encourage digital usage, we are incentivizing our customers with a cashback scheme to service interest payments through our online platforms. With businesses resuming, we have witnessed surge in gold loans as it is the most convenient form of availing working capital for small business and traders to kickstart their businesses.”

Speaking on the occasion George Alexander Muthoot, Managing Director said, “Our disbursements during the quarter was lower on account of closure of branches in the month of April 2020 due to nationwide lockdown. Once the branches opened, we saw higher level of repayments than disbursements, probably, on account of restrictions in movement of people. However, we witnessed a significant increase in disbursements since June 2020 which continues in July and August 2020. As initially guided, we are looking forward to achieve a 15% growth in gold loan portfolio for FY 21. Company also maintained a liquidity buffer of Rs.8,477crs as cash, bank and investments in liquid funds as on June 30 ,2020. Non-gold loan portfolio in subsidiaries constituted about 12% of consolidated loan portfolio. Collections in non-gold loan portfolio have significantly improved month on month. Additional Covid ECL provisions to the extent of Rs.32crs were made for non-gold loan portfolio in the quarter.”

Financial Highlights (MFIN):

 Q1 FY21Q4 FY20QoQ %Q1 FY20YoY %
 (Rs.in Crs)(Rs.in Crs)Change(Rs.in Crs)Change
Total Income          2,385          2,403-1%          1,85928%
Profit Before Tax          1,125          1,0973%             81738%
Profit After Tax             841             8153%             53059%
Earnings Per Share(Basic) Rs.          20.96          20.333%          13.2358%
Loan Assets       41,296       41,611-1%       35,81615%
Branches          4,573          4,5670%          4,5022%
ParticularQ1 FY21Q4 FY20Q1 FY20
Return on Average  Loan assets8.11%8.13%6.05%
Return on Average Equity28.16%28.39%21.70%
Book Value Per Share (Rs.)306.99288.43243.02
ParticularQ1 FY21Q4 FY20Q1 FY20
Capital Adequacy Ratio26.3025.4724.72
Share Capital & Reserves (Rs. in Crs)12,31611,5729,743

Business Highlights (MFIN):

ParticularQ1 FY21Q1 FY20Growth (YoY)
Branch Network4,5734,5022%
Gold Loan Outstanding (Rs. in Cr)40,49535,17115%
Credit Losses (Rs. in Cr)3240%
% of Credit Losses on Gross Loan Asset Under Management0.0069%0.0068%1%
Average Gold Loan per Branch (Rs. In Cr)8.868.248%
No. of Loan Accounts (in lakh)7682-7%
Total Weight of Gold Jewellery pledged (in tonnes)165176-6%
Average Loan Ticket Size53,42642,70525%
No. of employees25,43024,6443%

Other Highlights:

Innovative Digital Products

We launched two new products – Loan@Home and Gold Unlocker during the quarter. Loan@Home enables a company executive visiting the customer and do the due diligence on-the-spot post which the gold loan amount will be credited to customer’s bank account via a safe & agile process with the customer not required to step out of his/her home at all. Whereas Gold Unlocker, is a unique value proposition by Muthoot Finance for Indian households which will help unlock the value of their idle gold lying in bank lockers/home safe through an overdraft facility for their gold jewellery”.

Our Subsidiaries:

About Muthoot Insurance Brokers Pvt Limited:

MIBPL is a wholly owned subsidiary of Muthoot Finance Ltd. It is an unlisted private limited company holding a license to act as Direct Broker from IRDA since 2013.It is actively distributing both life and non-life insurance products of various insurance companies. During Q1 FY21, it has insured more than 135,000 lives with a first year premium collection of Rs. 182million under Traditional, Term and Health products. The same was 433,000 lives with a first year premium collection of Rs. 358 Million in Q1 FY20 respectively.

Key Business Parameters

ParticularsQ1 FY 21Q4 FY 20Q1 FY 20FY 20
Total Premium Collection (Rs. In millions)44310646063232
No. of Policies (In lakhs)1.427.954.4128.06
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