Shares in SKS Microfinance, India's only listed micro lender, dropped sharply on Tuesday on the back of quarterly earnings. The company reported a loss of Rs. 262 crore for the July to September quarter against a loss of Rs. 384.5 crore in the corresponding quarter last year. Net interest income rose to Rs. 29 crore against Rs. 59 crore a year ago.
Shares in the company traded 4.5 per cent lower at Rs. 115.50 on the NSE at 10.10 a.m. The broader Nifty was flat at 5,667.
A Rs. 34 crore service tax notice slapped on SKS Microfinance
ed to selling pressure in the counter. The authorities have given 30 days to the company to respond to the tax notice, which pertains to the FY08-FY12 period.
"The company has received show-cause notice from service tax authorities on October 23 to explain as to why the assignment of portfolio loans should not be classified under recovery service agent and the related income from the asset assignment transaction should not be subjected to service tax," SKS Microfinance said in a statement.
Provisions for bad loans stood at Rs. 234 crore against Rs. 353 crore (year-on-year). The company's Andhra Pradesh portfolio was reduced to nil from a high of Rs. 1,491 crore at the start of Andhra Pradesh microfinance crisis in October 2010. With this last and final provisioning for Andhra Pradesh exposure, SKS Microfinance Ltd looks beyond the Andhra Pradesh microfinance crisis, the company said in the statement.
The company has cash and bank balances of Rs. 358 crore as on September 30, 2012. In addition, the unavailed deferred tax benefit stands at Rs. 557 crore and will be available to offset tax on future taxable income, the statement added.
Source : NDTV
