Payment solution provider SBI Card on Monday reported a 13.8% year-on-year rise in net profit at Rs 393.29 crore for the quarter ended June 30 (April-June) compared to Rs 345.29 crore for the corresponding quarter of the previous financial year.
The higher profits were aided by a 34% rise in Interest Income from Rs 104.92 crore to Rs. 141.21 crore YoY. All other sources of income declined. Total revenue from operations increased at a very muted rate of 4.05% YoY for the quarter, from Rs 2068.28 crore to Rs 2152.20 crore. The newly public company managed to keep net profits up by reducing their total expenses by 5.89% and benefited highly from lower total tax expenses which were down by 27.7% from Rs 186.69 crore to Rs 134.97 crore, for the corresponding quarter.
SBI Card is the second-largest player in the Indian credit card market offering an extensive portfolio of cards catering to a wide range of customers. As the country is poised to go into a negative growth rate for the FY 20-21, credit card NPAs(Non-performing assets or bad loans) are expected to go up as well. SBI Card looks to be positioned well enough to tide over the negative phase with a good balance sheet and cash and bank reserves of Rs 676.03 crore as of March 31, 2020.
Share prices ended at Rs 765.90 up 1.32% after a highly volatile trading session on NSE. You can find the official Q1 result announcement here.