State-run infrastructure financing company IDFC is expected to report subdued numbers in July-September quarter on account of higher provisions but lower operating expenses may result in marginal decline in profit. Profit is likely to fall 3.3 percent year-on-year to Rs 471 crore in the quarter ended September 2014 compared to Rs 486.75 crore in the year-ago period while net interest income may increase 1.1 percent to Rs 692 crore from Rs 685 crore during the same period, according to the average of estimates of analysts polled by CNBC-TV18.
NII growth may continue being benign as company continued to consolidate loan book in the wake of new banking license. NII in Q1FY15 was flat with loan book down 7 percent Y-o-Y and net interest margin flat at 4 percent.
In Q1 provisions spiked 246 percent Y-o-Y to Rs 204 crore, resulting in profit falling 14 percent Y-o-Y. Nomura expects provision at Rs 100 crore as against Rs 50 crore in the year-ago period.
Analysts expect net interest margin to be flattish around 4 percent.
As far as asset quality is concerned, the management is still cautious. In an interaction with CNBC-TV18 during the quarter, the management had said gross non-performing loans could worsen and would stick to guidance of rising gross non-performing loans.
Non-interest income also needs to be watched. It was down 60 percent Y-o-Y to Rs 134 crore in Q1FY15.
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