M&M Financial Services’ Q1 Profit Falls, Misses Estimates

Mahindra & Mahindra Financial Services Ltd.’s profit declined for the fifth straight quarter as the company made higher provisions for bad loans.

The Mahindra group company’s net profit fell 45.9 percent to Rs 47 crore in the three months ended June over the year-ago period. That’s a third of Rs 148 crore consensus estimate of analysts tracked by Bloomberg.

Total income rose 16 percent to Rs 1,603 crore over the year-ago period. Assets under management grew 14 percent on a sequential basis to Rs 47,576 crore.

Provisions at Rs 425 crore compared to Rs 361 crore in the previous quarter. The company made an additional provision of Rs 83 crore during the quarter on a prudential basis, it said in a press statement.

“In view of improved sentiment in rural markets, the company has had higher collection efficiency, lower repossessions and lower growth of non-performing assets compared to same period previous year,” it said.

Shares of the financial services provider rose as much as 4.3 percent, the most in over a month, after the earnings were announced.