Mahindra and Mahindra Financial Services Ltd shares slumped by 15% in intraday trade today after the non-banking finance company (NBFC) posted a 66% drop in its consolidated net profit to Rs 108.50 crore in the first quarter (Q1) ended June.
Mahindra & Mahindra Financial Services Ltd (MMFSL), a provider of financial services in rural and semi-urban markets, has reported a profit after tax of Rs 108 crore during the quarter ended June 30 as against Rs 322 crore during the corresponding quarter last year, marking a decline of 66 percent. Mahindra Finance’s consolidated total income rose 23% year-on-year to Rs 2,838.40 crore during the June quarter against Rs 2,302 crore in the same period a year ago.
Its total value of assets financed for the quarter ended June 30 was Rs 10,598 crore as against Rs 10,339 crore during the same quarter previous year, registering a growth of 3 percent. Standalone assets under management stood at Rs 71,406 crore as against Rs 58,711 crore, clocking a growth of 22 percent in the year-on period. The company continues to be leading financer for automotive and tractors, including pre-owned vehicles. During the year, growth was higher in the pre-owned and commercial vehicle segment.
The company told the Business Standard, "The lower finance availability is hurting MHCV sales, while CV lending rates increased marginally. The reduction in the sale price of second-hand vehicles is resulting in slower buying of new vehicles. The advancement of purchase expected since BS-VI implementation shall increase prices."
(Inputs from ANI)