Quantum picks up 0.4% stake in SKS Microfinance for Rs 19Cr

Microfinance Focus, July 23, 2010: Billionaire investor George Soros’ hedge fund, Quantum has recently invested in India’s largest microfinance institution SKS, picking up around 3 lakh shares in the company for a total sum of Rs 19.08 crore, (Rs 636 per share). Quantum has picked up the shares from existing shareholder Yatish Trading Company Pvt Ltd. It will hold a 0.4% stake post the issue while Mumbai-based securities firm Yatish will have a 2.2% holding. The share price is equal to the price paid by hedge fund Tree Line Asia, which picked up 2.3% stake in SKS through slew of secondary transactions earlier this year as reported by VC Circle.

SKS wil become the first Indian MFI to get listed on stock exchange with its IPO opening on July 28. The IPO is being speculated to be issued within a price band of Rs 650- Rs 700 per share and it will close on July 30, 2010 for qualified institutional buyers and on August 2 for others. By way of this IPO SKS will be selling around 16.8 million shares and is expected to give discount to retail investors.

As of March 31, 2010, SKS had 6.78 million women borrowers and total disbursments worth more than Rs.14,000 crore ($3 billion). The Company’s gross income for the year ended 31st March, 2010 has increased to Rs. 958.93 crore from Rs. 554.00 crore in the previous year registering a growth of 73.1 percent. The companies’ Return on Equity stands at 21.54 percent for the same period.

The other investors in SKS include Sequoia Capital India (21.8%), Sandstone (12.9%), Kismet Capital (5.7%), Tejas Ventures (2.7%), Bajaj Allianz (2.6%), SIDBI (2.8%), Narayana Murthy’s Catamaran Fund (1.6%) and Unitus (5.7%)

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