Shriram Transport Q1 up only 7%, dented by high provisions

Moneycontrol Bureau

Chennai-based Shriram Transport Finance Company's first quarter (April-June) consolidated net profit rose at a slower pace by 7 percent year-on-year to Rs 366 crore, dented by higher provisions and write offs, which increased more than 24 percent to about Rs 260 crore.

However, the sluggish rise in net profit was in line with market expectations.

On standalone basis, the non-banking finance company (NBFC) too reported a muted growth of 6 percent in its net profit at Rs 341 crore for the quarter ended June 30, 2013-14.

Net interest income (NII) or the difference between interest earned and paid out, increased 12.43 percent to Rs 902 crore in the April-June quarter. The company is engaged in financing truckers. It has 569 branch offices across India.

During the current quarter, the company sold its entire 40 percent stake in Shriram Asset Management Company (SAMC).

"With the said stake sale, the company has ceased to be promoter of the SAMC and sponsor of Shriram Mutual Fund with effect from June 20, 2013," Shriram Transport Finance said in a release.

On consolidated basis, the company's borrowing expenditure (finance costs) surged by 44 percent y-o-y to Rs 937 crore.

saikat.das@network18online.com