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M&M Financial share price surges 12% on Q1 earnings, nod to rights issue

BusinessToday.In     July 20, 2020

M&M Financial share price gained over 12% in Monday's early session after the company posted robust numbers for the quarter ended June 2020. Company's consolidated profit after tax (PAT) jumped 300% to Rs 432 crore during the quarter ended June 30, 2020 against Rs 108 crore during the corresponding quarter last year.

Company's consolidated income rose 8% to Rs 3,069 crore in Q1 FY21 against Rs 2,838 crore in the same period last year. Further, the company's board also approved the conditions of an earlier-approved rights issue, for an amount not exceeding Rs 3,500 crore, of fully paid-up equity shares of the face value of Rs 2 each.

M&M Financial share price opened with a gain of 9.67% and later touched an intraday high of Rs 233.65, rising 12.39% against the earlier close of Rs 228 on BSE. Today, the stock has traded in a wide range of Rs 27.9 and also touched its day's low at Rs 205.75.  

M&M Financial stock price has gained 12.38% in one week and 31.4% in one month. M&M Financial share trades higher than 5, 20, 50 and 100-day but lower than 200-day moving averages. Total market capitalisation of the firm stood at Rs 14,159.17 crore as of today's session.

"The company, in order to cover the contingencies that may arise due to the COVID-19 pandemic, had incorporated the management overlays to reflect deterioration in the macro-economic outlook in the impairment loss allowance and accordingly considered an additional charge of Rs 477 crore (pre-tax) in the standalone financial statements and Rs 664 crore (pre-tax) in the consolidated financial statements for the quarter ended 30 June 2020," M&M Financial said in its regulatory filing.

On July 18, company's board approved the rights issue of issue size of 61,77,64,960, fully paid-up equity shares of the face value of Rs 2 each, for an aggregate amount not exceeding Rs 3,089 crore.

The rights issue, that opens on July 28, 2020, and ends on August 11, 2020, has been fixed as Rs 50 per fully paid-up equity share, including a premium of Rs 48 per fully paid-up equity share.

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