M&M Finance reports 33.7% surge in Q2 net profit at Rs352cr

M&M Finance reported rise of 4.16% in top line sales for the Sep-20 quarter at Rs3,035.11cr. The operating profits for the quarter ended Sep-20 were virtually flat at Rs499.96cr

Oct 26, 2020 05:10 IST India Infoline News Service

M&M Finance reported rise of 4.16% in top line sales for the Sep-20 quarter at Rs3,035.11cr. The operating profits for the quarter ended Sep-20 were virtually flat at Rs499.96cr while the net profits were up by 33.73% at Rs352.50cr on a yoy basis.


This had significant impact on the margins of the company too. For the Sep-20 quarter, the operating profit margins or OPM was marginally lower by 53 basis points at 16.47% while the net profit margins or NPM for the quarter expanded by 256 bps at 11.61% on the back of a lower tax bill.
Financial highlights for Sep-20 compared yoy and sequentially


Particulars Sep-20 Quarter Growth (yoy) Growth (qoq)
Total Revenues Rs3,035.11cr +4.16% -0.70%
Operating Profit Rs499.96cr +0.91% +90.96%
Net Profits Rs352.50cr +33.73% -18.42%
Key Ratios Sep-20 Quarter Sep-19 Quarter Jun-20 Quarter
Diluted EPS Rs4.57 Rs4.24 Rs7.00
Operating Margins 16.47% 17.00% 8.57%
Net Profit Margin 11.61% 9.05% 14.14%


Key takeaways from the Sep-20 quarter results

  • Being predominantly rural based, M&M Finance did not see too much of an impact due to COVID. In fact, the COVID profits were higher but that was more due to the exceptional profit of Rs.228 crore booked from the sale of stake in the AMC to Manulife.
  • As of Sep-20, M&M Finance had a debt equity ratio of 4.05:1 which is reasonable for a company that is in the business of financing. During the first half of the current fiscal year FY21, the total assets under management or AUM crossed Rs81,500cr.
  • During the quarter, M&M Finance crossed 6.9 million customers with a major portion of their demand book being contingent on the agricultural sector. In the overall GDP, only agricultural showed strong positive growth in the last 2 quarters.

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