Satin Creditcare on track to achieve FY24 AUM growth guidance of over 25%
HP Singh, Chairman and Managing Director of Satin Creditcare discussed the way forward for the company in a post-earnings call with CNBC-TV18. He believes the cost of funds has bottomed out and net interest margins will only improve from hereon.
Satin Creditcare, a microfinance company, is poised to surpass its fiscal year 2024 assets under management (AUM) growth target of 25%. The company had a robust 33% AUM growth in the current quarter.
In an interview with CNBC-TV18, HP Singh, Chairman and Managing Director of Satin Creditcare, provided insights into the company's growth trajectory.
"..the way the quarters are coming out, and the way the pent-up demand and disbursements are picking up in the rural space, I think we are aligned to probably be able to achieve this 25% plus growth," he said.
He also pointed out the consistent improvement in net interest margins (NIMs). Singh believes the cost of funds has reached its lowest point. The company's NIM has risen to 13.5% from 12.2%.
Satin Creditcare's unique approach to microfinance sets them apart from its competitors. The company does not provide top-up loans, focusing instead on a single loan model.
Explaining the growth drivers that lie ahead, Singh pointed to several factors contributing to their success. He emphasised the pent-up demand in the rural market, noting that income-generating and productive capacities have improved due to a normal monsoon and increased kharif sowing acreage. These positive developments have led to increased demand for loans, particularly at the grassroots level in rural areas.
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"I think it's a hybrid of both geographical diversifications deep diving as well as income-generating capacities having firmed up, so that is what is driving these disbursements up."
Shares of Satin Creditcare have gained more than 3% over the past month.
(Edited by : Shweta Mungre)
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