Large impairments land Muthoot Capital in Rs172 crore FY22 loss

Large impairments land Muthoot Capital in Rs172 crore FY22 loss

BBN Bureau

KOCHI/May18-2022: Impairment on financial instruments to the tune of a whopping Rs235.92 crore during the fourth quarter (Q4) has landed Muthoot Capital in a huge net loss of Rs153.22 crore for the fourth quarter.

For the full year too, the impairment on financial instruments was larger at Rs324.36 crore, which ultimately took the company to incur a net loss of Rs171.93 crore for the full year 2021-22 (FY22).

In fact, tax write-back of Rs51.33 crore and Rs57.12 crore for the fourth quarter and full year respectively has saved the company from closing the respective periods at larger losses.

Muthoot Capital said the company has gross NPA at 25.93 per cent, and hence to bring down the net NPA below the threshold limit, the company has made a one-time lump sum provision of Rs226.10 crore in this quarter.

“If the relaxation was availed, the GNPA would have been 18.70 per cent and the charge on the statement of profit and loss (P&L), lower to the extent of Rs132.75 crore, besides being able to recognize an additional income of Rs 8.71 crore,” the company explained.

The company had paid managerial remuneration in excess of the maximum permissible limit as per Section 197 of Companies Act, 2013.

A company statement said the amount paid in excess has been recovered from the managing director. The company has then provided for the recovered amount as it is in the process of seeking the shareholders’ nod for the payment of this recovered amount.

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