SKS Microfinance posts fabulous Q3FY16 results

SKS Microfinance has shown better financial performance during Q3FY16. The company’s total income from operations increased by 66.61 per cent to Rs 307 crore in Q3FY16 as compared to same period in previous financial year. Its total expenditure increased by 21.97 per cent to Rs 105 crore in Q3FY16 on a yearly basis. Meanwhile, SKS Microfinance’s provision and contingencies expense rose by more than 4 times to Rs 8.74 crore in Q3FY16 on a yearly basis.

SKS Microfinance’s EBITDA rose by two fold to Rs 202 crore in Q3FY16 as compared to same period in previous fiscal year. The EBITDA margin of the company expanded by 1250 basis points to 65.86 per cent in Q3FY16 on a yearly basis. Its interest expense increased by 68.7 per cent to Rs 133 crore and other income rose by 60.94 per cent to Rs 36 crore in Q3FY16 on a yearly basis. SKS Microfinance’s net profit also increased by twofold to Rs 79.49 crore in Q3FY16 as compared to same period in previous fiscal year. Its net profit margin expanded by 360 basis points to 25.87 per cent in Q3FY16 on a yearly basis.

Considering nine month results, SKS Microfinance's top line increased by 59.48 per cent to Rs 839 crore in 9MFY16 as compared to same period in previous fiscal year. The company’s EBITDA too rose by 80.08 per cent to Rs 529 crore in 9MFY16 on a yearly basis. Its net profit also increased by 48.53 per cent to Rs 219 crore in 9MFY16 as compared to same period in previous financial year.

SKS Microfinance has reduced the interest rate charged to borrowers from 20.75 per cent to 19.75 per cent pertaining to income generating loans extended on or after December 7, 2015. With this reduction, the company charges the lowest rate among private Mutual Fund Industries (MFIs) in the world. There has been an aggregate interest rate reduction of 4.8 per cent since October 2014. SKS Microfinance availed Rs 100 crore refinance from MUDRA at 10 per cent per annum.

The share price of SKS Microfinance increased by 8.69 per cent on bourses in early trades; and is trading at Rs 533.6 on an intraday basis.

SKS Microfinance is among the largest microfinance companies in India with presence across 18 states covering one lakh villages. The Company’s mission is to provide financial services to the economically weaker sections. Its products are categorized as Income Generation Loans (IGL) – Aarambh; Mid-Term Loan (MTL) – Vriddhi;Long Term Loan (LTL);Solar Loan;Mobile Loans;Housing Loans; Swarna - pushpam Gold Loan; and Life Insurance.