Indiabulls Financial Services plans to increase its number of branches by 10 per cent from the existing 156 in FY12. “The number of employees will also increase by seven to eight per cent in FY12, up from the existing headcount of 4,500,” said Mr Gagan Banga, CEO, Indiabulls Financial Services.
“At present, the company earns a spread of 150 basis points on home loans and 300 basis points on property mortgages,” Mr Banga said. The mortgages business constitutes 71 per cent of its assets. The company earns a spread of 400 basis points each on its other three businesses namely commercial vehicle loans, business loans and corporate loans which constitute the remaining 29 per cent of the loan book.
The company saw a 214 per cent year-on-year growth in consolidated quarterly net profit of Rs 202.54 crore, as against Rs 65.79 crore reported during the year-ago period. This was on the back of an 89 per cent y-o-y growth in its loan book, which touched Rs 17,356 crore.
Income from operations rose 60 per cent to Rs 596 crore whereas other income nearly doubled to Rs 80 crore due to a significant increase in fee income and a one time income of Rs 21.35 crore realised from a 26 per cent stake sale in Indian Commodity Exchange, ICEX.
Employee cost grew 21 per cent on account of an increase in headcount from 4,000 to 4,500. Increasing operational efficiency has led to a healthy improvement in the cost to income ratio from 26.58 per cent in Q4 FY10 to 21.13 per cent in Q3 FY11.
Rejig in funding
On the balance sheet front, the company re-jigged its funding profile, relying more on bank loans and NCDs while reducing reliance on CPs. “We want to bring down the share of CPs in our funding profile to 15 per cent,” said Mr Banga.
“The company has deployed Rs 1,845 crore in liquid and liquid plus schemes of various mutual funds,” he said.