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Spandana Sphoorty Q1 - Prudent Provisioning; Strategic Focus On Building Secured Assets: ICICI Securities

Spandana Sphoorty Q1 - Prudent Provisioning; Strategic Focus On Building Secured Assets: ICICI Securities

<div class="paragraphs"><p>A customer counts new Indian two thousand rupee banknotes outside an India Post branch in New Delhi, India. (Photographer: Anindito Mukherjee/Bloomberg)</p></div>
A customer counts new Indian two thousand rupee banknotes outside an India Post branch in New Delhi, India. (Photographer: Anindito Mukherjee/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

Spandana Sphoorty Financial Ltd.’s Q1 FY22 performance was characterised by prudent approach in recognising stress and strengthening balance sheet by building adequate provision buffer.

It built additional provision of ~Rs 1.5 billion towards stressed asset pool of Rs 7.65 billion (customer missing one full or partial EMI during Q1 FY22) and would continue to build further ~Rs 1.4 billion-1.5 billion provisioning pool over next three quarters.

Currently, Spandana Sphoorty holds cumulative provision buffer of Rs 5.7 billion, or ~7.8% of assets under management.

Further prioritising collections over growth helped it improve collections sharply to 93% by July 2021 from lows of 72% in May 2021.

Click on the attachment to read the full report:

ICICI Securities Spandana Q1FY22 Results Update.pdf

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