InvestorQ : Why did SBI Cards profits fall so sharply in the Dec-20 quarter?
Mary Joseph made post

Why did SBI Cards profits fall so sharply in the Dec-20 quarter?

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Arusha Ray answered.
8 months ago
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SBI Cards saw its PAT fall by over 50% to Rs.210 crore due to a sharp spike in asset impairment costs. Even overall revenues of SBI cards were 3.06% lower yoy in the Dec-20 quarter at Rs.2403 crore. In a way, the COVID was carried forward to the Dec-20 quarter and that reduced the volume of transactions resulting in lower revenues. Operating profits fell by 51.5% to Rs.282.88 crore.

During the quarter, the impairment losses and bad debts went up sharply from Rs.376 crore in Dec-19 to Rs.648 crore in Dec-20 quarter. This led to OPM contracting from 23.52% to 11.77% over the last one year. Due to bad debts and asset impairment losses in the light of COVID-19, PAT margins contracted from 17.53% in Dec-19 to 8.72% in Dec-20.

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