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DHFL Q2 Net Profit up by 52% at ₹ 439 Crore

Mumbai/ Chennai, 2018: DHFL, one of India’s leading housing finance company, today announced its Q2 results for the second quarter ended September 30, 2018. The company registered a net profit growth of 52% to ₹ 439 crore for the quarter ended September 30, 2018.

Assets Under Management (AUM) grew by 38% year-on-year, reaching ₹ 1,30,182 crore from ₹ 94,079 crore as on September 30, 2018.

Commenting on the company’s financial performance in the Quarter, Mr. Kapil Wadhawan, Chairman and Managing Director, DHFL saidOver the past few weeks, the financial services sector specifically NBFCs, witnessed an unexpected, temporary slump and liquidity tightening. DHFL has taken every step towards mitigating these issues. The company has been diligent towards all its repayments and fulfilled every financial obligation. DHFL immediately reiterated its strong positions on credit quality, credit ratings, no ALM mismatch, robust asset quality, strong liquidity and the company’s commitment towards all its repayment records. Since September 24 2018, DHFL has repaid liabilities of nearly ₹ 14,000 crores which includes more than ₹ 9,000 crores of CP repayments. This target was met by the company through internal liquidity generation and minimal external borrowings. DHFL’s low-ticket retail housing portfolio with clear and strong asset quality is evidenced through net sell-down/assignment of more than ₹ 7,400 crores of retail pools in a short span of 50 days to 8 banks and financial institutions.

Mr. Kapil Wadhawan added, “Over the past three decades DHFL, has witnessed various business and market cycles but have remained undeterred and realigned our business strategies. We have successfully navigated such cycles and through it all we maintained our commitment to our vision of transforming lives through home ownership and emerged much stronger as an organisation.

Mr. Wadhawan continued, “Our performance this quarter is well in line with our QoQ growth momentum. During the quarter in review DHFL maintained robust performance led by loan growth disbursements in the affordable housing segment. Considering that two-thirds of DHFL’s home loan portfolio is retail home loans wherein our average home loan ticket size is below 11 lakhs, DHFL has endeavored to protect margins at 300 to 305 bps. DHFL’s business is differentiated by several factors of which customer friendly service and our heritage in the affordable space, continues to lead the business.  We are actively expanding our loan book and committed to creating value for our stakeholders by delivering strong business growth. We continue to drive several growth-oriented initiatives aimed at developing an equitable society through wider financial access. Our business fundamentals are strong and we continue to be optimistic of future progress.”

Performance Details for the quarter ended September 30, 2018 as compared to the corresponding quarter of the previous year:

  • Net profit increased by 52% to ₹ 439 crore for the quarter ended September 30, 2018 as against ₹ 288 crore in the corresponding quarter of the previous year
  • Profit before tax rose by 61% to ₹ 633 crore for the quarter ended September 30, 2018 as against ₹ 394 crore in the corresponding quarter of the previous year
  • Loan book outstanding grew 35% to ₹ 1,10,093 crore during the quarter ended September 30, 2018 as against ₹ 81,380 crore in the corresponding quarter of the previous year
  • Loan disbursements were ₹ 13,870 crore for the quarter ended September 30, 2018, showing an increase of 39% over the corresponding quarter of the previous year
  • Total Income was up by 32% to ₹ 3,468 crore during the quarter ended September 30, 2018 as against ₹ 2,632 crore in the corresponding quarter of the previous year
  • Gross NPA stood at 0.96%.
  • Net Interest Margin stood at 3.15%.

Note – Current Quarter results are based on Ind AS, so comparative figures of previous corresponding quarter have been restated as per Ind AS.

Financial services sector witnessed a slowdown but the organization undertook the following steps:-

  • DHFL has neither defaulted on any bonds or repayment of its financial obligations, nor has there been any instance of delay on any repayment of any liability.
  • DHFL has repaid nearly ₹ 14,000 crores of Liability from September 24th 2018 till date, which includes CP repayment of over ₹ 9,000 crores.
  • DHFL has successfully implemented a securitization transaction of over ₹ 7,400 crores.
  • DHFL CP book is nearly 1.50% of our total borrowings and the total assets and liability book is over INR 1 Lakh crore.
  • The Company is extremely well-matched in case of the ALM position.
  • DHFL’s borrowing is well diversified with a banking consortium of 31 banks, NCDs, CPs, ECB and masala bonds. DHFL is one of the leading deposit taking HFCs.
  • Promoters of DHFL have not pledged any shares nor have they availed any loan against shares of DHFL.
  • Considering that two-thirds of DHFL’s home loan portfolio is retail home loans wherein DHFL’s average home loan ticket size is below 11 lakhs, DHFL has always endeavored to protect the margins at 300 to 305 bps.
  • DHFL maintains strong asset quality and registered one of the lowest NPAs in the industry. Reported Gross Stage 3 Loan Assets (equivalent to Gross NPA %) at 0.96%.

DHFL holds a leadership position in the affordable housing sector with majority of its home loan portfolio catering to the Lower and Middle Income (LMI) segment. 80% of DHFL’s home loan disbursements are in the affordable housing category with majority being first time home buyers availing housing finance to fulfill their homeownership dream. DHFL’s average loan ticket size at the portfolio level stands at INR 17 lakhs. DHFL’s robust performance continues to be driven by it’s strong focus on the LMI segment in Tier 2 and 3 markets. The company offers a range of home loan products including home loan, home extension loan, home improvement loan, plot loans, mortgage loan, project loan, SME Loan and non-residential property loan to all customer segments across India, retaining its concerted focus on the low and middle income segment.

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