SKS Microfinance, a for-profit Indian microfinance institution (MFI), reportedly has securitized receivables worth INR 630 million (USD 11.6 million) and sold the package to an undisclosed bank.The securitization received an A1 + (SO) rating from CARE Ratings, an Indian credit rating agency, which is their rating for short-term structured obligations (SO). This is reportedly the eighth securitization transaction that SKS Microfinance has conducted since April 2013 for an aggregate securitized amount of INR 8.66 billion (USD 158 million).
As of September 30, 2012, SKS reports a gross loan portfolio of USD 249 million disbursed to approximately 3.9 million borrowers. As of year-end 2011, SKS reported return on assets (ROA) of -49.85 percent and return on equity (ROE) of -125.51 percent. SKS does not accept deposits
By Brian LeBlanc, Research Associate
About SKS Microfinance
SKS Microfinance is a for-profit microfinance institution (MFI) that was launched in 1998. SKS converted into a public limited company in May 2009 and launched an initial public offering on July 28, 2010. It since diversified into offering gold loans and loans to small stores. Its equity investors include Quantum Hedge Fund, Sequoia Capital, Vinod Khosla, Small Industries Development Bank of India, Bajaj Allianz, Yatish Trading, Kismet Capital, Sandstone Capital, Silicon Valley Bank and Unitus. SKS currently trades on the Bombay Stock Exchange and the National Stock Exchange. As of September 30, 2012, SKS reports a gross loan portfolio of USD 249 million disbursed to approximately 3.9 million borrowers. As of year-end 2011, SKS reported return on assets (ROA) of -50 percent and return on equity (ROE) of -126 percent. SKS does not accept deposits.
About CARE Ratings
Founded in 1993, Credit Analysis and Research Limited (CARE) Ratings is and India-based credit ratings agency that offers credit research, analysis and ratings information for India’s capital market. Domestic companies and banks hold the majority of its shares.
Sources and Additional Resources
NewIndianExpress.com article, February 22, 2013,”SKS Recovers After Reaching a Securitization Deal,” http://newindianexpress.com/business/hot_stocks/article1474509.ece
MicroCapital story, December 17, 2012, “MICROCAPITAL BRIEF: SKS Microfinance of India Completes $10m Securitization, Stock hits 52-Week High,” https://www.microcapital.org/microcapital-brief-sks-microfinance-of-india-completes-10m-securitization-stock-reaches-52-week-high/
MicroCapital story, December 2, 2012, “MICROCAPITAL BRIEF: SKS Microfinance of India Announces $36m Securitization Under Amended Reserve Bank of India Guidelines,” https://www.microcapital.org/microcapital-brief-sks-microfinance-of-india-announces-36m-securitization-under-amended-reserve-bank-of-india-guidelines/
MicroCapital story, March 23, 2012, “MICROCAPITAL BRIEF: India’s SKS Microfinance Completes Securitization Deal Totaling $63m,” https://www.microcapital.org/microcapital-brief-indias-sks-microfinance-completes-securitization-deal-totaling-63m/
MicroCapital story, February 29, 2012, “MICROCAPITAL BRIEF: SKS Microfinance Completes Securitization Deals Totaling $122m,” https://www.microcapital.org/microcapital-brief-sks-microfinance-completes-securitization-deals-totaling-122m/
MicroCapital Universe Profile: SKS Microfinance http://microcapital.org/microfinanceuniverse/tiki-index.php?page=SKS+Microfinance
MicroCapital Universe Profile: CARE Ratings https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=CARE+ratings
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