SKS Q1 net up eightfold at Rs 49 cr

Total income in the quarter increased by 37.80% to Rs 168.95 cr from Rs 122.60 cr in the corresponding previous quarter

SKS Microfinance Limited, the only listed microfinance company in India, has reported a more than eightfold increase in net profit at Rs 49.32 crore for the quarter ended June, 2014, on the back of higher revenues and near flat expenditure. The company's net profit stood at Rs 5.18 crore in the year-ago period.

Total income of the company in the quarter under review increased by 37.80 per cent to Rs 168.95 crore from Rs 122.60 crore in the corresponding previous quarter while the expenditure grew only 1.43 per cent at Rs 71.79 crore despite the increase in employee costs.

SKS  announced a one per cent reduction in the interest rate charged from borrowers to 23.55 per cent with effect from October 1, 2014.  

“The announcement  is consistent with the company's policy of passing on the cost advantages accruing from economies of scale, operational efficiency and reduction in the cost of borrowing to its borrowers,” SKS said in a statement. The company was able to reduce the cost of borrowing by one per cent to 12.6 per cent in the first quarter of the current financial year from 13.5 per cent  rate of interest in the previous year, according to the company.

In the first quarter, the company's loan portfolio excluding the states of Andhra Pradesh and Telangana registered a 39 per cent increase to Rs 1,160 crore from Rs 830 crore in the year-ago period. Net interest income grew by 41 per cent to Rs 89 crore in the quarter under review as compared to Rs 63 crore in the corresponding previous quarter.