Microfinance Interviews

SKS Microfinance is a Bellwether for the Industry – V.L. Ramakrishnan, CFO, Suryoday Microfinance

The below article is brought to you in partnership with Microfinance Insights and Microfinance Gateway

SKS is currently the largest MFI in India with nearly seven million clients. By generating US$350 million through an IPO which got underway July 28, SKS plans to become the largest MFI in the world by 2012 with 15 million clients.

To learn more about what the SKS IPO means for clients in India, the Microfinance Gateway teamed up with Microfinance Insights to conduct one-on-one interviews with industry experts in India. Here we present the full interview with V L Ramakrishnan, CFO of Suryoday Microfinance based in Pune, India.
suryoday microfinance india

Microfinance Insights (Insights): What is your initial reaction to the SKS Microfinance’s IPO ?

V.L. Ramakrishnan (Ramakrishnan): We’re all elated for the fact that we are also in the same industry, and we are seeing an institution that was not so big until a couple of years and making it really big in a really short span of time.

Insights: How do you think the microfinance sector and the investor community at large will react to the IPO?

Ramakrishnan: SKS has a unique advantage. It has the first mover advantage. Obviously, whatever it does could possibly become trends and benchmarks for others to follow. In terms of reaction from people, there are certain pundits who say that the valuation is quite high. I personally feel that the model is strong enough for scalability for long-term benefits.

Insights: Do you think the frequency of MFI IPO’s will pick up?

Ramakrishnan: Yes, it opens a new avenue for microfinance companies, but at the same time I don’t think there’s going to be a deluge of public offerings. At best, I could visualize the next four or five large-scale microfinance institutions issue offerings. That could take anywhere from eight to 16 months.

Read the rest of the interview on the Microfinance Insights Website

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