06 Jan , 2022 By : monika singh
NEW DELHI – Shares of Spandana Sphoorty Financial tumbled 5 per cent in early trade on Thursday after the microfinance company announced its financial results with a delay and posted a consolidated loss of Rs 57.94 crore for the second quarter ended September 2021.
The company posted a net profit of Rs 66.76 crore for the corresponding quarter of the previous financial year.
The counter fell to Rs 394.85 against Rs 415 at the previous close on the National Stock Exchange. The scrip was the last trading around 3.3 per cent lower.
The company, caught in a bitter fight between its promoter and private equity investor Kedaara Capital, took a hit on the profitability on account of the high provisions made to cover asset quality risks.
The microfinance lender delayed the announcement of its second-quarter results as it failed to complete the audit in time due to the flux in management, including the exit of founder Padmaja Reddy in November.
The company’s total income in July-September, however, rose to Rs 373 crore from Rs 346 crore.
"Such change in management and other factors such as an increase in the portfolio at risk and NPA ratios due to higher delinquencies caused by Covid-19 pandemic has resulted in a breach of some of the covenants relating to borrowings," Spandana Sphoorty said in a regulatory filing to the stock exchanges, without giving details about the NPA ratios.
"The company has been regularly servicing all its borrowings and has sought forbearance/waiver from the lenders with respect to non-compliance with the covenants, wherever applicable," it said in the release.
The company had seen an around 7% increase in cash collections till mid-December 2021 compared with the average of those recorded in the quarter ended September 30, 2021.
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