Trouble continues to haunt SKS Microfinance, a leading micro-lender till recently.
While it has been posting losses due to retreats in the Andhra Pradesh market, its overall loan book, too, has started to contract.
For the quarter ended December 2011, the company’s overall loan portfolio shrank 31% to Rs1,810 crore as against Rs2,635 crore by the end of the first half of the current financial year. The portfolio includes Rs488 crore of AP loan book.
“We are now looking beyond AP crisis. We were conserving our resources, awaiting more clarity from banks on advancing funds to us. Now, the bank funding is resuming. Additionally, we would also have access to about Rs350-500 crore through QIP. All this should help us in expanding our overall portfolio in the fourth quarter,” S Dilli Raj, SKS’s chief financial officer, told DNA.
The weakened loan book has cut into revenues in the third quarter to Rs83.83 crore from Rs384.48 crore a year ago.
Its losses soared to about Rs427.79 crore in the December quarter as against a profit of Rs34.15 crore a year ago.
The accumulated losses are now pegged at about Rs1,000 crore.
However, the shrinkage in SKS’s loan book indicates that the non-AP market, too, has not been faring well for the company.
“The focus on non-AP market continues to remain. Now that the bank funding and additional resources too are set to become available, we are confident of recording growth in the fourth quarter,” Raj said.
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