The proposed fundraise will be part of an increase in the company’s overall borrowing limit and will be subject to approval from shareholders at the ensuing Annual General Meeting.
The Board of Directors will meet on Tuesday, August 25, to consider and approve, among other matters, the proposed fundraise through debt instruments, including non-convertible debentures in either Indian or foreign currency.
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The company said the proposed borrowing will not exceed ₹2,500 crore and will be undertaken as part of the proposed increase in the overall borrowing limit under Section 180(1)(c) of the Companies Act, 2013. The proposal will require approval from shareholders at the company’s ensuing Annual General Meeting.
First Quarter Results
Fedbank Financial Services Ltd reported a 52.5% year-on-year rise in net profit for the June quarter to ₹114.4 crore from ₹75 crore in the corresponding period last year.
Total income increased by 29.6% to ₹670.3 crore from ₹517.3 crore last year. Net interest income (NII) or core income for the Federal Bank unit rose by 38.7% year-on-year to ₹371.9 crore, while operating profit increased by 49.9% to ₹187.5 crore during the quarter.
Assets under management (AUM) grew 34.7% year-on-year to ₹21,136 crore, while disbursements increased 13.9% to ₹6,760 crore. Gold loan AUM surged 76.7% to ₹11,191 crore, accounting for 52.9% of the company’s total loan book, while mortgage AUM grew 14.5% to ₹9,777 crore.
The company said 99.2% of its AUM remains secured, reflecting its collateral-backed lending model.On the asset quality front, gross Stage III assets improved to 1.6% from 1.9% in the March quarter and 2.0% a year earlier, while net Stage III assets declined to 1.0% from 1.3% sequentially and 1.2% in the year-ago period. Credit cost remained low at 0.8% during the quarter.
The lender reported a return on assets (RoA) of 2.6% and a return on equity (RoE) of 15.4% during the quarter. Its cost-to-income ratio improved to 52.8% from 56.9% in the preceding quarter and 58.2% a year ago, while the capital adequacy ratio stood at 20.7%.
As of June 30, Fedbank Financial Services operated 757 branches across 17 states and Union Territories and had 5,376 employees.
Shares of Fedbank Financial Services Ltd ended at ₹149.50, down by ₹1.15, or 0.76%, on the BSE.
