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DHFL posts Q4 loss at Rs 2,224 crore, asset quality worsens

DHFL posted a net loss on its fair value change at Rs 2,550.17 crore for the quarter and Rs 2,458.4 crore for full year.

July 13, 2019 / 11:40 PM IST
DHFL (File Image: PTI)

DHFL (File Image: PTI)

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Dewan Housing Finance Corporation (DHFL) has posted a big loss of Rs 2,224 crore for the quarter ended March 2019, which was dented by additional provisioning.

It was the first quarterly loss reported by the company since its inception, as per financials record available on Moneycontrol since June quarter 1998.

The stock had lost nearly 89 percent of its value in the last one year. It was trading at Rs 615.55 a year ago, and it is at Rs 68.45 as of July 12, 2019.

The housing finance company had reported a profit of Rs 314 crore in the December quarter and Rs 134 crore in the June quarter of last year.

"In the backdrop of a significant slowdown in disbursement and loan growth post September 2018, the financials of the company have been quite strained for the quarter impacting the overall performance of the year," Kapil Wadhawan, Chairman and Managing Director said in a BSE filing.


Due to the additional provisioning of Rs 3,280 crore (including net loss on fair value), the company reported a net loss of Rs 2,223 crore for the quarter and a net loss of Rs 1,036 crore for the whole year ( as against a profit of Rs 1,240 crore in previous year), he added.

DHFL posted a net loss on its fair value change at Rs 2,550.17 crore for the quarter and Rs 2,458.4 crore for the whole year.

However, the operating profit for the quarter that ended in March was Rs 372 crore, down 34 percent YoY and Rs 2,378 crore for the whole year, up 2 percent compared to FY18, the company said.

Asset quality worsened during the quarter as gross non-performing assets (NPA) increased significantly to 2.74 percent, as against 1.12 percent in previous quarter and 0.96 percent in March quarter 2018.

Assets under management (AUM) stood at Rs 1.19 lakh crore at the end of March 2019, higher by 8 percent over Rs 1.11 lakh crore reported in the year-ago period, company said.

Loan book outstanding at the end of quarter was at Rs 89,387 crore, lower by 3 percent compared to Rs 92,165 crore YoY.

Wadhawan said since the last 9 months, with a single minded focus, the company has met all its financial obligations and is looking to return to business normalcy at the earliest.

Since September 2018, DHFL has managed to make repayments of over Rs 41,800 crore primarily through the securitisation of assets and repayment collections.

The housing finance company said it is in an advanced stage of submitting its resolution process under the inter-creditor agreement as entered into by banks. "As already announced, the inter-creditor agreement will examine and firm up the terms of the resolution process by July 25, 2019 and make it operational before September 25, 2019."

The company further said the process of identifying a strategic investor is also nearing completion, which will bring in an equity investor into DHFL to bolster its capital base.

The board will be reconvening in the next two weeks to look through the potential proposals and will decide accordingly on the way forward," it added.

DHFL said the joint lender forum has also taken into account the need for recommencement of business and commence originating new home loans. "Banks would enable the infusion of necessary liquidity into the system. It is expected that DHFL will be able to restart its business in August 2019 and scale it up in the months ahead.

Meanwhile, company said it has not made an interest payment of Rs 28.41 crore and Rs 19.59 crore due on July 8 and July 6 respectively.

The board of directors on July 13 also approved the appointment of Asish Saraf - Senior Vice President of the company, as the Chief Risk Officer of the company.
Moneycontrol News
first published: Jul 13, 2019 11:38 pm

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