Satin Creditcare - Worst Is Behind; Focus On Growth, Stable Asset Quality: HDFC Securities Initiates Coverage

HDFC Securities Retail Research

Satin Creditcare Network Ltd. is one of the largest players in the micro finance institution industry with a wide geographical reach. The company’s entry into micro, small and medium enterprise and housing finance segment through subsidiaries could provide growth momentum with lower asset quality.

It is also reducing its risk by diversifying geographically.

The banking correspondent business for Indusind Bank Ltd. is gaining scale providing a strong source of other income. Improving asset quality should lend a hand to increased profitability and thereby improvement in return ratios.

In H1 FY23, it has provided for all known and expected non-performing assets and absorbed the entire pain. Now onwards, it can focus on growth with stable asset quality.

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