Some analysts expect the loan book of SKS Microfinance to double to Rs 3,000 crore by the end of 2013-14 from Rs 1,500 crore levels in 2012-13 even in the absence of fresh lending in Andhra Pradesh.
The loan book of the company is expected to double on the back of its geographical expansion. The company has increased its presence in states such as UP, Rajasthan, Gujarat, amongst others and this may drive growth going forward.
While SKS has ventured into gold financing (pilotal stage) and mobile phone loans (less than 5 percent of loans), they are too small in size to contribute meaningfully to either top-line or profits of the company.
The microfinance institution (MFI) managed to raise funds efficiently via both equity (recent QIP) and debt routes. The company securitised loans worth Rs 981 crore in 2012-13 so far.
Some analysts expect the year 2013-14 to be a transition year for SKS owing to overhang of higher operating cost on the profitability of SKS.
These analysts expect the company to achieve more than 20 percent return on equity from 2013-14 onwards as company scales its loan book and operating leverage kicks in, given that the companyÂ’s current infrastructure is under-utilized.
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