Spandana Sphoorty’s Accelerated Provision Marred Q3 Earnings: ICICI Securities
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Spandana Sphoorty’s Accelerated Provision Marred Q3 Earnings: ICICI Securities

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 Q3 FY21 performance was characterised by aggressive write-offs to the tune of approximately Rs 2 billion (more than 120-days past due) and clear focus on pursuing growth but in calibrated manner, as reflected in 14% year-to-date-FY21 growth in assets under management.

Further, a provision buffer of ~Rs 3.6 billion (~5% of AUM) against a non-paying customer pool of ~2.2% and proforma net non-performing loan at 1% would cushion earnings in coming quarters.

Collection efficiency (ex-arrears) improved steadily to ~93% in Q3 FY21 from ~89% in Q2 FY21.

Click on the attachment to read the full report:

ICICI Securities Spandana Q3FY21 Results Update.pdf

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