LIC Housing Finance (LICHF) came out with its results for the first quarter of the current fiscal. In its financials, the company recorded a decrease in net profits by 11 percent, which stood at Rs. 228 crore as compared to Rs. 256.50 crore it recorded for the same quarter last year. The reason for the company's dissatisfactory performance is attributed to a rise in its expenses and a fall in its income.
LICHF reported a rise in interest income on home loans by 27 percent, which stood at Rs. 1718 crore, an increase from last fiscal's Rs. 1358 crore.
The total expenses of the company also rose by 36 percent and stood at Rs. 1463 crore, a rise from Rs. 1,073 crore it recorded the same quarter last year. The total expenses of the company mainly consist of provisions for bad loans and interest expense. Income from other sources also declined by 30 percent and was reported at Rs. 21 crore.
On the company's performance, Mr. V.K. Sharma, Director and Chief Executive of LICHF said, "Business environment has been very challenging....Margins have been under strain owing to the high interest rate regime, high borrowing costs and a lower developer loan portfolio."
LIC issued a statement in which it said that the fall in the profits of the company was due to a decrease in developer loan portfolio and poor developer loan disbursals because of the general economic situation.