IIFL Finance profit jumps over two-folds to Rs 212 crore in July-September

IIFL Finance on Tuesday reported more than two-fold jump in its consolidated net profit to Rs 212.68 crore due to a rise in interest income and gains from other sources.

The non-banking finance company had posted a net profit of Rs 86.48 crore in the same quarter a year ago.

The company's total income (consolidated) increased by 30.2 per cent to Rs 1,515.30 crore in the July-September period of 2020-21 as against Rs 1,163.04 crore in the year-ago period, IIFL Finance said in a regulatory filing.

Interest income rose by 24.1 per cent to Rs 1,349.94 crore in the second quarter of 2020-21 from Rs 1,088.10 crore in the year-ago quarter.

Besides, the company had a net gain on fair value changes of Rs 41.94 crore during the quarter under review, as well as over five-fold jump in income from other sources at Rs 49.60 crore.

The Taxation Laws (Amendment) Ordinance 2019 provides for an option to pay tax at concessional rate of 22 per cent (plus surcharge and cess), the company said.

"These financial results are prepared on the basis that the parent company and some of its subsidiaries would avail the option to pay income at the lower rate.

"Consequently, wherever applicable, the opening deferred tax asset has been measured at the lower rate, with one-time charge of Rs 99.28 crore during the quarter ended September 30, 2019 and the same has been restated during the quarter ended March 31, 2020 resulting into a gain of Rs 49.38 crore pursuant to merger of India Infoline Finance with the company on March 30, 2020 with appointed date as April 1, 2018," it added.

On COVID-19-related provisions, the company said it has parked aside an overall Rs 696.94 crore.

"In addition, while assessing the liquidity situation, the group has taken into consideration certain assumptions with respect to repayments of loan assets, sale of loan assets and undrawn committed lines of credit, based on its past experience which have been adjusted for current events," it added.

On the recent scheme of grant of ex-gratia payments related to returning the difference of compound interest and simple interest during March-August 2020, it said the company is in the process of validating such amount to be refunded/credited to the eligible customers and shall comply with the necessary guidelines within defined deadlines.

Since the central government is going to reimburse the differential interest, there is unlikely to be any impact on the financial results, it added.

IIFL Finance shares traded at Rs 80 apiece on BSE, up 5.12 per cent from the previous close.

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