SKS Microfinance has surged nearly 11% to Rs 137 after the company said it has received A ratings for Rs 2,000 crore of bank facilities from a leading rating agency, which could help it enhance credit availability and reduce cost of borrowings.
The company having borrowings of Rs 1,675 crore as of August 31, 2013 expect the impact will be positive.
"The ratings would help to reduce the risk weights assigned to banks’ exposure on SKS Microfinance from the present 100% to 50% in the case of long-term facilities and 30% for short-term facilities,” said Mr. S. Dilli Raj, Chief Financial Officer, SKS Microfinance in a press release.
The ratings are likely to enhance credit availability and reduce the cost of borrowing as they will free up capital allocation for banks in the case of SKS Microfinance Limited's borrowings, he added.
The stock opened at Rs 128 and hit a high of Rs 138 on NSE. A combined 420,000 shares change hands on the counter till 0930 hours on NSE and BSE.
The company having borrowings of Rs 1,675 crore as of August 31, 2013 expect the impact will be positive.
"The ratings would help to reduce the risk weights assigned to banks’ exposure on SKS Microfinance from the present 100% to 50% in the case of long-term facilities and 30% for short-term facilities,” said Mr. S. Dilli Raj, Chief Financial Officer, SKS Microfinance in a press release.
The ratings are likely to enhance credit availability and reduce the cost of borrowing as they will free up capital allocation for banks in the case of SKS Microfinance Limited's borrowings, he added.
The stock opened at Rs 128 and hit a high of Rs 138 on NSE. A combined 420,000 shares change hands on the counter till 0930 hours on NSE and BSE.