The board also approved to subscribe to additional shares as well as to any unsubscribed portion of the rights issue, up to the total Issue size of MMFSL subject to compliance of applicable laws including the minimum public shareholding requirements, it said.
Meanwhile, MMFSL reported a profit after tax (PAT) of Rs 159 crore, up 128 per cent against Rs 684 crore in the year-ago quarter. Net interest income (interest earned less interest expended), however, grew 8.7 per cent year-on-year (YoY) to Rs 1,376 crore from Rs 1,266 crore in the previous year quarter.
The company’s pre-provisioning operating profit (PPoP) up 44.2 per cent YoY at Rs 843 crore as opex declined 38 per cent YoY to Rs 350 crore. The decline in opex was largely driven by 47 per cent YoY decline in other expenses. In addition, a 2 per cent sequential decline was seen in headcount.
“With 40 per cent collections from moratorium customers in July, the initial trend is encouraging. However, the key monitorable would be whether collection efficiency has reached pre-Covid-19 levels post the lifting of the moratorium in September. With the rights issue, leverage is likely to decline to 4.1 times, which we believe is enough to absorb any potential asset quality shocks,” analysts at Motilal Oswal Securities said in results update.
At 01:11 pm, M&M Financial Services
was up 9 per cent at Rs 226 on the BSE, against 0.79 per cent rise in the S&P BSE Sensex. The trading volumes on the counter jumped an over 6-fold with a combined 102 million equity shares changing hands on the NSE and BSE so far.