The best part I like abt MFI business in India in general n Satin in particular is v little NPAs which is the most imp criteria for any financial organization. This hints that average BPL Indian is far more honest then average industrialist expert in creating NPAs for Indian banks.
Recent RBI regulatory supervision over MFIs post AP fiasco & advent of credit bureaus specializing in MFI like HighMark & Equifax have also helped.Seeding of these data by Aadhar will further strengthen the database.
Fact that MFIs like Satin helps the hapless villager in providing loans at v reasonable interest viz a vis usurious moneylender like Kanhaiya Lal of Mother India movie in income generation activities is also most imp.
Satin also has the advantage of being leader in most under penetrated states of UP,MP,Bihar,J&K ,Raj where the competition intensity is v less.As such opp size remains huge .CARE has been upgrading rating to BBB+.
Risk is non receipt of small bank license while most of competitors have got it,just enough CAR which may lead to imminent equity dilution due to huge growth & poor liquidity as 85-90% stake is with PE & promoters.
