Spandana Sphoorty's Q4 consolidated net profit declines 42% to Rs 28.6 cr

Spandana Sphoorty has articulated a Vision 2025 and scale up business to an AUM of Rs 15,000 crore levels in the next three years

Spandana Sphoorty Financial Ltd’s (SSFL) consolidated net profit declined by 42 per cent to Rs 28.6 crore in the March quarter (Q4FY22) on one-time settlement fees and transition expenses. It had posted a consolidated net profit of Rs 49.3 crore in the year-ago period.

Its consolidated total income also declined sharply from Rs 480.3 crore in Q4FY21 to Rs 299.1 crore in Q4FY22. Its business operations were impacted in the second half of FY22 after Padmaja Reddy resigned from her position as the Managing Director of the company on November 2, 2021.

For FY22, the microfinance institution's net profit declined to Rs 69.8 crore from Rs 145.5 crore in FY21. The total income stood at Rs 1,480 crore in FY22 as against Rs 1,505.6 crore in FY21, according to the stock exchange filing on Monday. The MFI's shares closed 3.49% up at Rs 430.95 per share on Monday.
 

Subsequent to Reddy’s resignation, certain disputes arose between her and the board. Later, the board and Reddy settled the disputes in June 2022. Some of the issues addressed through settlement include payment of dues and clearing related party transactions.  The one-time settlement fees are pegged at Rs 40 crore, according to the company.

Consolidated Assets Under Management (AUM) stood at Rs 6,581 crore at the end of Q4FY22, out of which around 44 per cent (Rs 2,878 crore) of the book was new disbursement.

Shalabh Saxena, Managing Director and CEO, said FY22 was a watershed year for Spandana Sphoorty. The company managed the various disruptions during the year. The company has articulated a Vision 2025 and scale up business to an AUM of Rs 15,000 crore levels in the next three years, he said.  

About 15 per cent of AUM is restructured but no moratorium was provided to customers. The collection efficiency of this book was 64% for the quarter ended March 2022 and 74 per cent for the month of March 2022. The total provisions of Rs 648 crore on balance sheet are sufficient to cover any risk in the portfolio as of March 2022, the company said.