BW Communities

LIC Housing Finance Reports Rs 1,300 Cr Net Profit In Q1 FY25 Amid Decline In Net Interest Income

BW Online Bureau Aug 03, 2024

Despite the drop in NII, total disbursements for the quarter rose to Rs 12,915 crore, up from Rs 10,856 crore in Q1 FY24

LIC Housing Finance has announced a net profit of Rs 1,300 crore for the first quarter of fiscal year 2025 (Q1 FY25), marking a 2 per cent decrease compared to the same period last year. The decline in net profit is primarily attributed to a drop in net interest income (NII), which fell by 10 per cent to Rs 1,989.08 crore from Rs 2,209.44 crore in Q1 FY24. The net interest margin (NIM) for the quarter also decreased to 2.76 per cent from 3.15 per cent in the year-ago period.

Despite the drop in NII, total disbursements for the quarter rose to Rs 12,915 crore, up from Rs 10,856 crore in Q1 FY24. Disbursements in the individual home loan segment increased to Rs 10,932 crore, compared to Rs 9,419 crore in the corresponding period last year. Project loans also saw significant growth, reaching Rs 521 crore from Rs 251 crore in Q1 FY24.

The individual home loan portfolio stood at Rs 2.46 trillion as of June 30, 2024, reflecting a 7 per cent increase from Rs 2.31 trillion as of June 30, 2023. Conversely, the project loan portfolio declined to Rs 8,099 crore from Rs 11,321 crore in the same period last year. Overall, the total outstanding portfolio grew by 4 per cent to Rs 2.88 trillion from Rs 2.76 trillion in Q1 FY24.

Provisions for expected credit loss (ECL) reduced to Rs 5,670.07 crore as of June 30, 2024, from Rs 7,590.68 crore as of March 31, 2023. The Stage-3 exposure at default improved to 3.30 per cent, down from 4.37 per cent as of June 30, 2023.

Regarding asset quality, LIC Housing Finance's gross non-performing assets (NPA) ratio improved slightly to 3.21 per cent from 3.31 per cent in the previous quarter (Q4 FY24). However, the net NPA ratio saw a marginal increase to 1.68 per cent, up from 1.63 per cent in the previous quarter.

These mixed results reflect the company's ongoing efforts to navigate the challenges posed by fluctuating interest incomes while maintaining a strong disbursement performance and improving asset quality.