Piramal Finance Q3 net profit zooms to ₹401 crore

Non-bank lender Piramal Finance on Friday reported that its net profit for the December quarter zoomed to ₹401 crore from ₹39 crore in the year-ago period.

The company’s managing director and chief executive, Jairam Sridharan, attributed the profit growth to a combination of factors, including growth in assets under management, expansion in net interest margins, control over operating expenses and lower credit costs.

Its AUM jumped by over 23% during the quarter, NIMs expanded by 0.50 per cent to 6.30%, operating expenses grew by just 4% and the provisions were up 36%, as per a statement.

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The core net interest income grew 31% to ₹1,227 crore, while the other income was up 23% at ₹252 crore for the reporting quarter.

The return on AUM stands at 1.9% at present, and the company is aiming to take it further up to 3% over the medium term, Sridharan said, adding that NIMs will have to expand by 0.30% more to achieve the target.

Exuding confidence that the NIMs can expand further, Sridharan said that the recent rating upgrade, coupled with the lower cost of funds driven through borrowings from multilateral agencies recently will help the NIMs going ahead.

From an asset quality perspective, assets unpaid for over 90 days were steady at 0.8% as of December-end.

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The Piramal Finance scrip closed 1.53₹ down at ₹1,792.95 apiece on the BSE as against 0.94% correction on the benchmark.