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Mumbai, Jan 23 (PTI) Leading financial services player JM Financial today reported a Rs 118.60 crore consolidated net profit, up just 1.3 per cent over the year-ago period, in the December quarter, driven down by a poor show by its ARC business that had booked higher profit in year-ago period.
Excluding the ARC (asset reconstruction company) arm profit, which came in at Rs 8 crore against Rs 65 crore in the year-ago period due to the sale of Leela Goa assets, the other businesses did well, pushing revenue higher by 40 per cent, indicating that its flagship credit business has not faced any note-ban headwind.
Consolidated profit would have been higher by Rs 28 crore had it not been for the consolidation of its ARC balance-sheet into the holding firm during the quarter, JM Financial group chief financial officer Manish Sheth said.
“During the reporting quarter we consolidated our ARC business into JM Financial’s book. This was following a marginal hike in our stake in it, thus making it a subsidiary.
“The December 2015 quarter was exceptionally good as we sold Leela Goa assets booking a profit of Rs 65 crore. This year there was no asset sales by the ARC arm which is a heavily cyclical business and therefore profit is only Rs 8 crore. Our profit excluding ARC business rose by Rs 28 crore,” Sheth told PTI in a post-earnings concall.
He said during the quarter JM increased its holding in the ARC arm to 50.01 per cent, up from 50 per cent earlier, making it a subsidiary from October 1 as against an associate before that.
JM Financials’ ARC arm is a joint venture between four public sector banks, including Indian Overseas Bank, Canara Bank, Vijaya Bank and a few private equity players, who collectively now hold 49.99 per cent.
However, its net after tax and before minority interest and share of associates rose 9.34 per cent to Rs 163.95 crore. (MORE)
This is published unedited from the PTI feed.
