Going bullish on the country’s only listed microfinance company, foreign investors have more than doubled their holding in SKS Microfinance to nearly 36 per cent over the past financial year with purchase of shares worth an estimated Rs 380 crore.
Foreign Institutional Investors (FIIs), which held 13.41 per cent stake in the Hyderabad-based microfinance player at the end of financial year 2011-12, raised their exposure to 35.94 per cent as on March 31, 2013, according to the latest shareholding data available with the stock exchanges.
Taking into account the average market value of SKS shares, a 22.53 percentage point rise in FII holding in the company would be equivalent to purchase of shares worth about Rs 380 crore.
The FII holding in SKS has gone up consistently during the last three quarters, after hitting a record low level of 8.33 per during the April-June quarter 2012.
However, the total promoter holding dropped to 26.03 per cent in the January-March quarter 2013 from 36.84 per cent in the three months ended March 31, 2012.
Shares of SKS have surged by seven per cent during the financial year 2012-13. The stock took a major beating for months together after its listing in August 2010 at a price of over Rs 1,000 per share.
Despite a revival over the past year, the shares are currently trading near Rs 31 per share. The company had sold shares in its initial public offer at a price of Rs 985 apiece.
During January-March 2012, FIIs pared their holding in the company marginally — from 14.72 per cent to 13.41 per cent and fell to a record low of 8.30 per cent in the April-June quarter.
However, foreign investors’ stake climbed to 31.77 per cent in the July-September quarter, and rose further to 32.81 per cent as on December 31, 2012.
SKS posted a net profit of Rs 1.2 crore in the December quarter after posting seven successive quarters of losses, as the company embarked on a multi-pronged turnaround strategy.
The company’s operations were affected after Andhra Pradesh came up with regulations in October 2010 restricting lending and recovery.
The company had completed 12 securitisation transactions with seven funding partners aggregating to Rs 1,207 crore during 2012-13. These transactions helped SKS fund around 1.6 million micro loans extended to borrowers belonging to the economically weaker sections.