A Memorandum of Understanding (MoU) for the channel financing cooperation of Ashok Leyland's dealers was inked by IDBI Bank and Ashok Leyland. The Memorandum of Understanding calls for cooperation in order to deliver customized financial solutions created especially for dealers by the participating organizations.
"With the combined strength of IDBI Bank Ltd and Ashok Leyland, the network of AL dealers will now have financing solutions to suit their needs using digital technology," Ashok Leyland CFO Gopal Mahadevan said.
Suresh Khatanhar, the deputy managing director of IDBI Bank, explained that the bank's 'e-Supply Chain Financing' digital channel finance solution was specifically developed to meet the working capital requirements of approved dealers and merchants connected to corporations.
"Our partnership will enable us to serve numerous businesses in India. Through the e-SCF tool, our goal is to provide seamless financial support to Ashok Leyland's dealers, fostering growth and resilience in the entire supply chain," Khatanhar added.
The MoU was announced at the same time that IDBI Bank revealed its Q1 results, which showed a 62% increase in net profit year over year, to $1,224.2 crore from $756.4 crore in the same period previous year. The institution had a significant increase in its net interest income (NII) during the first quarter of the fiscal year 2023–2024. NII increased by a remarkable 60.7% to reach 3,997.6 crore, up from 2,487.5 crore the year prior.
The IDBI Bank's net interest margin (NIM) improved noticeably during the quarter, going from 4.02% in the first quarter of the previous fiscal year, FY23, to 5.80% in just one quarter, an increase of 178 basis points (bps). In addition, the operational profit for the quarter increased by 47% to 3,018.72 crore from the reported 2,051.81 crore for the same time the year before.
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