- Piramal Enterprises, a leading diversified non-banking financial company (NBFC), saw a 6.15% drop in its shares in today’s intraday trade, following the release of its Q4 FY24 and full fiscal FY24 financial figures.
- The company reported a consolidated net profit of ₹137 crore for the March quarter, a significant improvement from the ₹196 crore loss in the corresponding period last year.
- However, for the full fiscal year, the company reported a loss of ₹1,683 crore for 2023–24, compared to a profit of ₹9,969 crore in the previous year.
Piramal Enterprises shares drop 6.15% following Q4 FY24 and full fiscal FY24 financial results, with the company reporting a consolidated net profit for the March quarter but a loss for the full fiscal year.
Q4 FY24 Financial Performance
Piramal Enterprises reported a consolidated net profit of ₹137 crore for the March quarter, a significant improvement from the ₹196 crore loss in the corresponding period last year. This improvement was attributed to write-backs on taxation and investments in alternative investment funds. Interest income for the reporting quarter remained steady at ₹1,944 crore compared to the preceding quarter and increased by 1% year-on-year (YoY). However, net interest income fell by 18% YoY to ₹755 crore from ₹917 crore in Q4 FY23, with a 10% decrease on a quarter-on-quarter (QoQ) basis.
Full Fiscal FY24 Financial Performance
For the full fiscal year, the company reported a loss of ₹1,683 crore for 2023–24, compared to a profit of ₹9,969 crore in the previous year. Net interest income for FY24 dropped by 20% to ₹3,022 crore, compared to ₹3,757 crore reported in FY23. Operating expenses increased to ₹2,774 crore from ₹2,215 crore in FY23, representing a 25% YoY growth.
Merger of Piramal Enterprises with Piramal Capital & Housing Finance
The Board of Directors approved a composite scheme of arrangement for the merger of Piramal Enterprises Limited (PEL) with its 100% subsidiary Piramal Capital & Housing Finance Limited (PCHFL). Following the merger, PCHFL will be renamed Piramal Finance Limited (PFL). As part of the merger consideration, PEL shareholders will receive one equity share of PFL for every one equity share of PEL, along with one NCRPS (non-convertible non-cumulative non-participating redeemable preference share) of ₹67 of PFL, subject to RBI approval, the company said in its earnings report.
Conclusion
Despite the significant improvement in the March quarter, Piramal Enterprises reported a loss for the full fiscal year, leading to a drop in its shares. The company is now focusing on optimising operating leverage in the growth business and reducing the contribution of the legacy business. With the merger of PEL with PCHFL, the company is hopeful for a stronger performance in the new fiscal year.
