Religare Report On India Microfinance Crisis brewing – SELL SKSM

Precursors to the last nine microfinance failures point to a crisis brewing in India. Most past crises, both domestic and global, were preceded by a mix of (1) headlong growth (50% AUM CAGR for Indian MFIs over FY13-FY15, plans for 50-60% growth by FY19), and (2) heady return expectations (post massive PE/VC capital injections). We have an anti-consensus Negative stance on the sector and rate the only listed player, SKS Microfinance, a SELL.

India Microfinance – Sector Report 19Aug15