Motor & General Finance Limited (MGF) has announced its financial results for the second quarter of fiscal year 2026, revealing a mixed performance with notable changes in its investment portfolio.

Consolidated Performance

MGF reported a consolidated net profit of ₹110.63 crore for Q2 FY2026, a significant improvement from the ₹23.01 crore profit in the previous quarter. The company's revenue from operations remained relatively stable at ₹168.04 crore.

Standalone Results

On a standalone basis, however, the company faced challenges, reporting a net loss of ₹205.57 crore for the quarter, compared to a profit of ₹24.76 crore in the previous quarter.

Key Financial Highlights

Divestment of Associate Company

A significant development during the quarter was the sale of MGF's equity shareholding in its associate company, Jayabharat Credit Limited. This transaction was based on an independent valuation and resulted in:

• A loss of ₹248.95 crore on a standalone basis
• A gain of ₹54.31 crore on a consolidated basis

The company noted that the sale was executed at a price lower than the quoted market price due to the thin trading volume of Jayabharat Credit Limited's shares on the stock exchange.

Other Notable Points

• Other income for the quarter included ₹42.00 crore as enhancement compensation received.
• The company primarily operates in the lease/renting/sale of immovable property business.
• The trading window for the company's shares remains closed until November 17, 2025.

Financial Impact

The divestment of Jayabharat Credit Limited has had a significant impact on MGF's financial results:

• The standalone net loss of ₹205.57 crore can be largely attributed to the ₹248.95 crore loss from the sale.
• On a consolidated basis, the transaction contributed to the improved net profit of ₹110.63 crore, reflecting a gain of ₹54.31 crore.

The contrasting effects of this divestment on standalone and consolidated results highlight the complexity of MGF's financial structure and investment strategy.

Motor & General Finance's mixed results reflect the current dynamics in the real estate and financial services sectors. The significant difference between standalone and consolidated figures underscores the impact of the company's investment decisions and market conditions on its overall financial health.

Motor & General Finance Limited (MGF) has announced its financial results for the first quarter of the fiscal year 2024, ending June 30, 2023, showing a turnaround in its standalone performance while still facing challenges on a consolidated basis.

Standalone Performance

MGF reported a standalone net profit of ₹1.77 lakh for Q1 FY24, marking a significant improvement from the loss of ₹99.09 lakh in the previous quarter and a loss of ₹6.27 lakh in the same quarter last year. This positive shift indicates a recovery in the company's core operations.

The company's revenue from operations saw an uptick, rising to ₹149.11 lakh from ₹135.69 lakh in the previous quarter, reflecting a growth of 9.89% in its primary business activities.

Operational Efficiency

A notable aspect of MGF's Q1 performance was the substantial reduction in total expenses. On a standalone basis, expenses were reported at ₹207.91 lakh, significantly lower than the ₹400.61 lakh recorded in the previous quarter. This considerable decrease of 48.10% in expenses played a crucial role in the company's return to profitability.

Consolidated Results

Despite the positive standalone results, MGF faced challenges on a consolidated basis. The company reported a marginal consolidated net loss of ₹0.20 lakh for the quarter, indicating that some of its subsidiaries or associated companies might still be navigating through difficult market conditions.

Business Focus

Motor & General Finance Limited primarily operates in the lease, renting, and sale of immovable property sector. The improvement in revenue suggests a potential uptick in demand for its services or successful execution of property transactions during the quarter.

Key Financial Metrics

The earnings per share (EPS) improved to ₹0.00 from (₹0.26) in the previous quarter, aligning with the company's return to profitability.

Corporate Actions

The company's Board of Directors convened on August 10, 2023, to review and approve the financial results. Following the announcement, the trading window for the company's securities reopened on August 14, 2023, in compliance with regulatory requirements.

While Motor & General Finance has shown signs of recovery in its standalone operations, the marginal consolidated loss suggests that the company may still face challenges in its overall business environment. Investors and stakeholders will likely be watching closely to see if this positive trend in standalone performance can be sustained and translated into consolidated profits in the coming quarters.