JM Financial announces unaudited financial results for the quarter and half year ended September 30, 2012.
Mumbai, October 30, 2012: The Board of Directors of JM Financial Limited, at its meeting held today, considered and approved the unaudited financial results for the quarter and half year ended September 30, 2012.
Consolidated Results – Key Highlights:
FY 13 – Q2 compared to FY 12 – Q2
Ø Total income increased by 13.87% to Rs. 245.03 crore from Rs. 215.19 crore.
Ø Net profit before tax increased by 24.90% to Rs. 55.20 crore from Rs. 44.20 crore
Ø Net profit after tax, minority interest and share of associates increased by 23.58% to Rs. 33.72 crore from Rs. 27.29 crore.
The Earnings Per Share (EPS) and Diluted Earnings Per Share (DEPS), for the quarter ended September 30, 2012 is Re. 0.45 (not annualised).
FY 13 – H 1 compared to FY 12 – H 1
Ø Total income increased by 17.05% to Rs. 495.50 crore from Rs. 423.31 crore,
Ø Net profit before tax increased by 41.29% to Rs. 113.00 crore from Rs. 79.98 crore,
Ø Net profit after tax, minority interest and share of associates increased by 33.51% to Rs. 69.03 crore from Rs. 51.70 crore.
The EPS for the half year ended September 30, 2012 is Re. 0.92 (not annualised) and DEPS for the said half year is Re. 0.91 (not annualised).
Announcing the quarterly results, Mr. Nimesh Kampani, Chairman, JM Financial Group said, "The economic environment has improved during the last quarter due to several measures taken by the Government; this is getting reflected in the steady rise in the capital market activities; however, there still remains some ground to cover in terms of regaining confidence about the economy. The Group’s second quarter and half year’s performance has been better as compared to the quarter and half year during the previous Financial Year. Our NBFC arm continues to post improved performance and has been a significant contributor to our growth.
Looking ahead, we remain optimistic and hope to see encouraging economic environment, both globally and domestically and are well positioned to capitalise on the available opportunities arising out of improved economic scenario."
Investment banking and securities business:
Our Investment banking business closed the Rights issue of Bajaj Finserv Limited for Rs.940 crore and QIP by South Indian Bank Limited for Rs. 442 crore. We also closed three public issues of Non Convertible Debentures: Shriram Transport Finance Limited for Rs 600 crore, Shriram City Union Finance Limited for Rs.434 crore and by Religare Finvest Limited for Rs.332 crore. We were also involved in placement of a block deal of Shriram City Union Finance Ltd by two private equity investors.
Our mergers and acquisitions pipeline continues to remain healthy with several mandated transactions across buy side, sell side (including cross border transactions) and corporate restructuring. However, uncertainty prevails on the timing of closing of these transactions.
The Institutional Equity Business has gained further traction in a challenging scenario. Our focus continues to remain on catering to the needs of the clients in a fiercely competitive environment and adding clients
Our Investment Advisory and Distribution business has continued to focus on offering wide range of products and services to our customers. Besides equities and derivatives, the focus has been to offer commodities, currencies and fixed income products. During the quarter, we focused on advisory based brokerage services where the brokerage yields are higher. In the distribution business focus was on mobilization of fixed deposits and corporate bonds.
Fund based activities:
The business continued its activity of capital market funding, catering to IPO Funding, Security Backed Financing, Loan against shares (LAS)/ Margin funding, Mutual fund financing, ESOP financing and Sponsor financing. We also continued providing the funding to corporates for their general requirements including towards their commercial real estate activities against moveable/immovable properties. Despite pressure on our Net interest margin, we have done well in the financing business. We continue to nurture this business with a dedicated management of the book and margin on lending. We are confident of maintaining a strong footprint in this segment, concurrently keeping an eye on the risk element. The overall funding book stood at Rs. 2,485 crore as on September 30, 2012. The treasury book for fixed income securities was at Rs. 770 crore.
During the quarter, the Asset Reconstruction business saw incremental recoveries from restructuring of corporate and retail accounts while acquisition activity was almost negligible. The rising corporate debt restructurings were the highlight of the season on the backdrop of a difficult operating environment. With expectation that the banking and financial institutions will off-load few restructured accounts, the near term outlook looks promising. However, deal closure may be a concern going forward as well, primarily due to price expectation mis-match between the Banks and us.
Alternative Asset Management:
At the end of the quarter, the combined AUM/ AUA of the private equity fund and real estate fund stood at around Rs.1,325 crore.
The Private Equity Fund is fully invested/ committed and the focus continues to remain on nurturing its investments so as to maximize value for opportune exits at the appropriate time.
JM Financial Property Fund's Offshore and Onshore schemes have invested its corpus fully in real estate development assets comprising largely of residential projects. The portfolio also includes commercial, retail and hospitality assets. These investments are in Tier I and in certain prominent Tier II cities.
Some of the projects have been completed while others are at different stages of development. The Fund has initiated the process of making investment realizations by actively working with its portfolio companies in exiting from operational assets. The Fund has commenced distribution to its investors and is focused on realizing all its investments within the term of the respective schemes.
The Mutual Fund average AUM for the quarter ended September 30, 2012 stood at Rs. 5,624 crore. The average AUM under Equity schemes was at Rs. 564 crore and under the Debt Schemes was at Rs. 5,060 crore.
Appointment of Independent Director
Mr. Keki Dadiseth has been appointed on the Board of Directors of JM Financial Limited as an independent director.
Mr. Dadiseth has to his credit an illustrious career of 27 years at Hindustan Lever Limited between 1973 to 2000, during which term he was the Chairman of the Board between 1996 to 2000. He was also associated with the Unilever Group as Director between 2000 and 2005.
Mr. Dadiseth serves as independent director on the boards of Britannia Industries Limited, Piramal Healthcare Limited, Siemens Limited, The Indian Hotels Company Limited and Godrej Properties Limited. He is also on the boards of ICICI Prudential Life Insurance, ICIC Prudential Asset Management Trust and Prudential Plc, UK. He is the non-executive chairman of Omnicom India, a member of International Advisory Board of Fleishman-Hillard Inc, International Advisors Board of Goldman Sachs and a member of Strategic Advisory Board of Atos India Private Limited. Mr. Dadiseth serves as Chairman of Sony India Pvt Ltd and Senior Advisor to Sony Group in India.
Mr. Dadiseth has been closely associated with various industry, educational, management and medical bodies. He serves as a Trustee of the Ratan Tata Trust and is the Chairman of the Managing Committee of Breach Candy Hospital Trust. He also serves as a Member of Governing Board of Indian School of Business.
Forward - Looking statements
This press release (‘document’) containing JM Financial Group’s activities, projections and expectations for the future, may contain certain forward-looking statements based upon the information currently available with the Company or any of its subsidiaries and associate companies. The financial results in future may vary from the forward-looking statements contained in this document due to uncertainties and unforeseen events that may impact the businesses of the JM Financial Group. The Company assumes no responsibility to publicly amend, modify or revise any forward-looking statements, on the basis of any subsequent developments, information or events.
This document is for information purposes only and any action taken by any person on the basis of the information contained herein is that person’s responsibility alone and neither JM Financial Group nor any of their directors or employees will be liable in any manner for the consequences of such actions.