PNB Housing Finance on Wednesday said its consolidated net profit fell over 5 percent to Rs 243.28 crore for the first quarter ended June 30, as the business was impacted due to the second wave of the coronavirus pandemic.
The non-banking finance company had posted a net profit of Rs 257.18 crore in the year-ago period. On a sequential basis, it was higher than Rs 127 crore in the March 2021 quarter.
On its proposed Rs 4,000 crore capital raise plan, PNB Housing Finance said: "The company on 20th June 2021, filed an appeal before the Securities Appellate Tribunal (SAT) against the letter issued by SEBI. The case is currently sub-judice under SAT with the final order awaited".
The deal was announced on May 31, 2021, in which a clutch of investors led by a US-based Carlyle group will pick up equity and warrants of the company for a Rs 4,000 crore fund infusion.
Under the deal, Pluto Investments S.a.r.l. and Salisbury Investments Pvt Ltd would acquire an equity stake in PNB Housing Finance. State-owned Punjab National Bank holds a little over 32 percent stake in the company.
The issue, which is subject to legal, shareholder and regulatory approvals, has reached the SAT after it came under the lens of markets regulator Sebi for valuation of the shares to be offered.
PNB Housing Finance has challenged Sebi's directive and the matter is before the Securities Appellate Tribunal (SAT), which has reserved its order.
Meanwhile, in a significant development, the Competition Commission has given its nod for the proposed investments by Carlyle Group and other investors in PNB Housing Finance Ltd.
The transaction has been approved by the Competition Commission of India (CCI) under the Green Channel.
The equity and warrants are fixed to be issued at Rs 390 a share, much lower than the current prevailing price of the company's shares on the stock exchanges.
The total income (consolidated) of PNB Housing fell to Rs 1,692.88 crore in Q1FY22, as against Rs 1,872.33 crore in Q1FY21, the company said in a regulatory filing.
On a standalone basis, the net profit during the quarter was Rs 234.96 crore, compared to Rs 259.61 crore a year ago.
The total income stood at Rs 1,676.45 crore in June 2021 quarter, lower than Rs 1,868.58 crore in the year-ago period.
"The second wave of COVID-19 impacted the business performance of the company as compared to last quarter. Despite this, the company recorded healthy profits and margins during the quarter. The company continues to focus on increasing its digital footprints, grow retail business with efficient underwriting and collection models and optimise costs to create value for all its stakeholders," Hardayal Prasad, Managing Director and CEO, PNB Housing Finance, said.
The net interest income grew nearly 13 percent to Rs 550 crore during the quarter from Rs 448 crore in the year-ago period.
On the asset front, the gross non-performing assets (NPAs or bad loans) spiked to 6 percent of the gross advances by June 30, 2021, from 2.76 percent a year ago.
The net NPAs too soared to 3.61 percent from 1.67 percent.
The company's gross NPAs stood at Rs 3,625 crore by end of Q1FY22. It also made provisions worth Rs 2,700 crore against expected credit loss (ECL). It held Rs 995 crore as a regulatory provision, following the National Housing Bank (NHB) norms.
The CRAR (capital to risk-weighted assets ratio) improved to 21.4 percent by June-end this year from 18.73 percent.
However, the cost to income ratio rose to 16.6 percent from 15.1 percent, mainly because of lower fee income to lesser disbursements as business operations were impacted due to the lockdown.
PNB Housing said it will continue to focus on its affordable housing "Unnati" book, which registered a growth of 163 percent year-on-year in disbursements during the quarter at Rs 123 crore.
The loan book under Unnati stands at Rs 2,986 crore.
The total disbursements during the quarter stood at Rs 1,759 crore. Of this, Rs 1,652 crore was towards retail and Rs 107 crore towards corporate.
Prasad said the company continues to reduce its corporate book and focuses on the retail segment.
On its corporate book remedial actions, the company said it has achieved resolutions in IREO Pvt Ltd with an outstanding of Rs 150 crore with zero haircuts; Windlass Developers Rs 30 crore; Pate Developers Rs 20 crore (nil haircut) and three other NPA accounts with Rs 4 crore outstanding and nil credit loss.
Besides, the accounts of Vipul Ltd (Rs 353 crore outstanding) and Ornate Pvt Ltd (Rs 181 crore) are in the final stages of resolution.
Resolutions are underway on NPA accounts -- Supertech Ltd (Rs 244 crore); Radius (Rs 259 crore) and Arena Superstructure Pvt Ltd (Rs 187 crore).Shares of PNB Housing Finance closed 5 percent higher at Rs 720.45 apiece on BSE.