Sundaram Finance Ltd. (SFL) has registered an eight per cent growth in net profit for the year ended March 31, 2014, at Rs. 443 crores as compared to Rs. 410 crores in the previous year. The Board has recommended a dividend of Rs. 10 per share.
Despite testing market conditions, gross NPA and net NPA as on March 31, 2014, stood at 1.23 per cent and 0.45 per cent respectively. Gross receivables managed by the company stood at Rs. 18,158 crores (Rs. 17,645 crores). Net worth increased to Rs. 2,405 crores from Rs. 2,087 crores.
Disbursements for the year stood at Rs. 9,606 crores as against Rs. 9,991 crores. Deposits crossed the Rs. 1,600-crore mark and stood at Rs. 1,666 crores.
Commenting on the performance, Mr. TT Srinivasaraghavan, Managing Director, Sundaram Finance Ltd., said: “This was perhaps the most challenging year for the CV industry since the slowdown we witnessed in 1997-98, with sales of medium and heavy commercial vehicles plummeting 25% or more in two successive years, 2012-13 and 2013-14. With dwindling freight offerings and spiralling operating costs, transport operators have been experiencing severe cash flow strains. Viewed against this backdrop, the company has been able to maintain a tight leash on its asset quality, thereby enabling it to report a reasonable growth in profits. While overall disbursements were down 3% over the previous year, the company maintained or marginally improved its market share in all its key asset segments. The growth in tractor business was a bright spot for us as we continued to improve our market share in that segment.”
On the growth opportunities, Mr. Srinivasaraghavan said: “The CV industry is witnessing a transformation, and we are gearing ourselves to both adapt to the changes and take advantage of the emerging opportunities. While CVs and cars will continue to remain the backbone of our business, there is enormous headroom to expand our presence in the tractor and the construction equipment segments, both of which are poised for strong growth in the days ahead.”
On the outlook for the year, he said that while the overall sentiment is upbeat with a stable Government in place, it would take up to six months before any actual recovery in the automotive sector is made. The mood is one of cautious optimism.