Suryoday Small Finance Bank
Company Background:
Established in 2009, in Navi Mumbai, Suryoday Small Finance Bank operated as NBFC before getting small finance banking license from RBI in 2016. Suryoday has over 1.18 million customers as of FY2019. Assets under management of Suryoday stand at Rs. 3,000+ crores. Suryoday operates through a network of 382 outlets as of FY19. Suryoday has presence in 9 states and 2 Union Territories.
Some of the Key investors include HDFC Ltd, HDFC Life, IDFC Bank, IFC, Lok Capital, ASK Capital Advisors, Evolence capital, TVS Capital funds & GAJA Capital. During FY19, Suryoday received investments from DEG – a KfW Group Company and Kotak Life.
Financial performance:
Suryoday’s financial performance has been strong over the past 3 years. Bank’s cost of funds has declined from 12.1% to the current 8.8%. Net interest margins have improved from 10% to 12.6%. Cost to income ratio has improved from 72.9% to 48%. Return on Assets has improved from 1.2% to 3.1%. Return on equity has improved to 14% from a mere 4%, 3 years ago. The growth in all these parameters is reflected in the growth in PAT (Profit-After-Tax) from Rs. 16 crores to Rs. 87 crores at a CAGR of 139%. Suryoday Bank has a healthy capital adequacy of 36%.
| Unit | FY19 | FY18 | |
| Branches | # | 382 | 241 |
| 1) Micro finance Focused outlets | # | 211 | 215 |
| 2) Bank Branches | # | 171 | 26 |
| NII | crore | 338.8 | 163.7 |
| OPEX | crore | 196 | 131.4 |
| PPoP* | crore | 212.2 | 70.4 |
| PAT | crore | 86.6 | 10.1 |
| Cost to Income | % | 48 | 65.1 |
| GNPA | % | 1.8 | 3.5 |
| NNPA | % | 0.8 | 1.9 |
| Networth | crore | 881 | 540 |
| Capital Adequacy | % | 36 | 37.9 |
Suryoday plans to diversify its products to increase share of secured loan portfolio. Net NPA of 0.8% as of FY19, is one of the best in the industry. A Snapshot of the financial performance is given below: (Amounts in 1000’s)
| Particulars | FY17 | FY18 | FY19 |
| Interest Earned | 2,437,045 | 2,868,815 | 5,301,080 |
| Other Income | 110,889 | 380,443 | 693,474 |
| Total INCOME | 2,547,934 | 3,249,258 | 5,994,554 |
| Growth % | 27.5% | 84.5% | |
| Interest Expended | 1,152,060 | 1,231,546 | 1,912,921 |
| Operating Expenses | 1,017,872 | 1,313,764 | 1,959,550 |
| Provisions and Contingencies | 226,998 | 602,696 | 1,256,102 |
| Total Expenses | 2,396,930 | 3,148,006 | 5,128,573 |
| Growth % | 31.3% | 62.9% | |
| Net Profit for the Year | 151,004 | 101,252 | 865,981 |
| Growth % | -32.9% | 755.3% | |
| EPS (Diluted) | 2.9 | 1.55 | 12.61 |
For detailed results on financial performance, please click here
Future Outlook:
Suryoday is expected to keep its growth momentum intact with management planning to add nearly 100-150 outlets in FY20. Additionally, the Bank aims to grow AUM by 40% p.a. The cost of funds is projected to reduce as share of deposits grow and the current cost of capital is near 8.8%.
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