SPANDANANSE31 January 2023

Spandana Sphoorty Financial Limited has informed the Exchange about Investor Presentation

Spandana Sphoorty Financial Limited

Ref: SSFL/Stock Exchange/2022-23/142

Date: January 31, 2023

To BSE Limited, Department of Corporate Services P. J. Towers, 25th Floor, Dalal Street, Mumbai – 400001

Scrip Code: 542759

Dear Sir/Madam,

To National Stock Exchange of India Limited, Listing Department Exchange Plaza, C-1, Block G BandraKurla Complex, Bandra (E) Mumbai – 400051

Symbol: SPANDANA

Sub: Investor presentation on the unaudited financial results of the Company for the quarter ended December 31, 2022.

Ref: Regulation 30 of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

Pursuant to Regulation 30 of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 please find enclosed herewith a copy of Investor Presentation of the Company on the unaudited financial results for the quarter ended December 31, 2022.

Kindly take the above on record.

Thanking you.

Yours sincerely, For Spandana Sphoorty Financial Limited

Ramesh Periasamy Company Secretary and Compliance officer

Spandana Sphoorty Financial Limited CIN - L65929TG2003PLC040648 Galaxy, Wing B, 16th Floor, Plot No.1, Sy No 83/1, Hyderabad Knowledge City, TSIIC, Raidurg Panmaktha, Hyderabad – 500081, Telangana Ph: +9140-45474750 | contact@spandanasphoorty.com | www.spandanasphoorty.com

Spandana Sphoorty Financial Limited

….Committed to low-income households

Q3 FY23 Investor Presentation

Years

Safe Harbor

This presentation and the accompanying slides (the “Presentation”), which have been prepared by Spandana Sphoorty Financial Limited (the

“Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe

for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment what so ever. No offering of

securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company.

This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no

representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and

reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may

consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded.

Certain matters discussed in this Presentation may contain statements regarding the Company’s market opportunity and business prospects that are

individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performance and are subject to

known and unknown risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties include, but are not limited to, the

performance of the Indian economy and of the economies of various international markets, the performance of the industry in India and world-wide,

competition,

the company’s ability to successfully implement

its strategy,

the Company’s future levels of growth and expansion,

technological

implementation, changes and advancements, changes in revenue, income or cash flows, the Company’s market preferences and its exposure to market

risks, as well as other risks. The Company’s actual results, levels of activity, performance or achievements could differ materially and adversely from

results expressed in or implied by this Presentation. The Company assumes no obligation to update any forward-looking information contained in this

Presentation. Any forward-looking statements and projections made by third parties included in this Presentation are not adopted by the Company and

the Company is not responsible for such third-party statements and projections.

Q3 FY23 Business Performance

Q3 FY23: Increased momentum across all parameters 19% QoQ growth in AUM

Calibrated Start of Growth Engine

Improving Asset Quality

Client Addition

Disbursement

AUM

1 – 90 DpD

GNPA

NNPA

2.19 L

₹2,361 Cr

₹6,852 Cr

2.6%

5.3%

2.5%

77% QoQ

70% QoQ

19% QoQ

310 bps QoQ

210 bps QoQ

130 bps QoQ

Healthy Fund Raising & Liquidity

Strong Financial Performance

New Lenders Onboarded

8 Total lenders 49*

Funds Raised

Cash & Bank Balance

Net Interest Income

PPOP

PAT

₹2,138 Cr

₹1,025 Cr

₹254 Cr

₹141 Cr

₹71 Cr

98% QoQ

16% QoQ

28% QoQ

29% QoQ

* Includes arrangers of Capital Market instruments

Positive movement across all key operational growth vectors

No. of borrowers

AUM per Branch

(In lakhs)

+3.2%

23.5

21.3

21.7

22.4

(In ₹ Cr)

5.9

+10.9%

6.1

87% Rural 13% Urban

5.3

5.5

Mar-22

Jun-22

Sep-22

Dec-22

Mar-22

Jun-22

Sep-22

Dec-22

Number of Employees

Branch count

No. of Employees

8,763

8,294

8,426

8,732

No. of Loan officers

+5.4%

6,521

6,099

6,374

6,718

1,120

1,117

1,115

Mar-22

Jun-22

Sep-22

Dec-22

Mar-22

Jun-22

Sep-22

Dec-22

New member acquisition drives growth 77% growth over Q2; 46% loan to new members

Split of Disbursements (loan count)

Q2FY23

Q3FY23

46%

54%

46%

54%

Existing member loans

New member loans

New members acquired (in ‘000)

+77%

219

101

106

123

Q4FY22

Q1FY23

Q2FY23

Q3FY23

Strong momentum in disbursement ~70% increase over Q2

Disbursement (in ₹ Cr)

+70%

2,361

1,385

1,320

1,391

Q4FY22

Q1FY23

Q2FY23

Q3FY23

Improvement in current book from 68.4% to 92.1% Collection efficiency continues to be stable

AUM & Current Book

Collection Efficiency (Incl. Arrears)

Post Apr-21 (% of AUM)

48%

70%

82%

92%

18.5%

6,852

95.0%

102.4%

106.1%

101.3%

102.1%

85.8%

86.9%

92.1%

90.0%

7,000

6,800

6,600

6,400

6,200

6,000

5,800

5,600

5,400

5,200

5,000

6,089

68.4%

5,782

5,513

85.0%

80.0%

75.0%

70.0%

65.0%

Q4FY22

Q1FY23*

Q2FY23

Q3FY23^

AUM (in ₹ Cr)

Current Book (% of AUM)

Q4FY22

Q1FY23

Q2FY23

Q3FY23

2.8% of AUM has flowed forward while the balance has been pulled back or stayed in the same bucket

* ₹702 Cr written-off during the quarter; ^ Post Sale of ₹117 Cr portfolio to ARC

Consistent improvement in (1 to 90) book… 1 to 90 book down by 54% QoQ

14.4%

1 to 90 Book

8.4%

1 to 30 DPD

7.5%

5.7%

2.6%

4.0%

2.9%

1.2%

Q4FY22

Q1FY23

Q2FY23

Q3FY23

Q4FY22

Q1FY23

Q2FY23

Q3FY23

3.4%

31 to 60 DPD

2.6%

61 to 90 DPD

1.9%

1.5%

0.8%

1.6%

1.4%

0.9%

Q4FY22

Q1FY23

Q2FY23

Q3FY23

Q4FY22

Q1FY23

Q2FY23

Q3FY23

… accompanied by GNPA & NNPA reduction…

17.2%

8.9%

6.7%

3.2%

7.4%

3.8%

5.3%

2.5%

Q4FY22

Q1FY23

Q2FY23

Q3FY23*

• •

Provisions for NPA amounts to ₹191 Cr Total provisions of ₹272 Cr (4.0% of AUM) on Balance Sheet – sufficient to cover any risk in the portfolio

* Post Sale of ₹117 Cr portfolio to ARC

GNPA

NNPA

… with adequate provision on the Balance Sheet Pre-Apr’21 book (7.7% of AUM) contributes 70% of GNPA

Q3 FY23

Q2 FY23

Provisioning & Coverage

Stage 1

Current

- 1-30

Stage 2

Stage 3*

Total

AUM (₹ Cr)

6,390

6,311

364

6,852

% AUM

ECL Provision

Coverage

93.25%

92.10%

1.16%

1.44%

5.31%

100%

191

272

0.63%

0.62%

1.98%

41.60%

52.49%

3.98%

AUM (₹ Cr)

5,190

5,025

165

166

426

5,782

% AUM

ECL Provision

Coverage

89.76%

86.90%

2.86%

2.87%

7.37%

100%

204

279

0.61%

0.57%

2.05%

25.83%

47.85%

4.82%

Q3 FY23

Q2 FY23

Impairment on financial instruments in Q3FY23 owing to Amount (₹ Cr)

SSFL

Consolidated

SSFL

Consolidated

- Write-off (ARC & others)

- Change in ECL % from 47.9% to 52.5% on opening NPA

5.10%

5.31%

7.31%

7.37%

2.30%

2.52%

3.89%

3.84%

- On flow during Q3

- On stage 1, 2 & others

67.9

19.9

41.5

10.3

55.0%

52.49%

48.02%

47.85%

- Sale consideration (ARC), adjusted against impairment cost

(95.0)

GNPA#

NNPA

PCR

Capital Adequacy (CRAR %)

39.13%

45.24%

* Post sale of ₹117 Cr portfolio to ARC

44.6

Lender support continues to be strong ~98% growth in fund mobilization; 8 new lenders onboarded in Q3FY23

Total Borrowings (in ₹ Cr)

+98%

2,138

1,080

691

738

308

155

Q1FY22

Q2FY22

Q3FY22

Q4FY22

Q1FY23

Q2FY23

Q3FY23

• Marginal cost of borrowing stable at 12.66% for Q3FY23 vs. 12.64% in Q2FY23 • Weighted average cost of borrowing at 11.5% vs. 11.2% end of Q2FY23

Diversified borrowing profile; Capital Adequacy at ~39%

Diversified Funding Mix (As on 31-Dec-22)

Net-worth and Capital Adequacy

39%

₹5,199 Cr

33%

14%

PSU Private Banks NBFC FPI DFI Capital markets

55% borrowings from Banks / FI’s

Capital Adequacy

42.4%

46.8%

51.1%

47.9%

45.3%

39.1%

Net worth (Rs. crs)

Capital infusion of ₹ 290 Cr

2,743

2,763

2,733

3,088

2,817

2,867

2,961

Gearing ratio

Q1FY22

Q2FY22

Q3FY22

Q4FY22

Q1FY23

Q2FY23

Q3FY23

1.9x

1.8x

1.5x

1.2x

1.1x

1.3x

1.7x

Financials showing a healthy movement (1/2)

Total Income (₹ Cr)

Net Interest Income (₹ Cr)

Yield# (%)

Cost of Borrowings (%)

+21%

375

299

259

310

191

162

+16%

254

219

17.6%

16.4%

+200 bps

21.5%

19.5%

11.8%

10.8%

11.5%

11.2%

Q4FY22 Q1FY23 Q2FY23 Q3FY23

NIM# (%)

Cost to Income (%)

Opex to AUM (%)

+80 bps

13.8%

13.0%

10.5%

9.9%

69.8% 68.7%

-500 bps

8.5%

49.7%

44.7%

-80 bps

8.0%

7.7%

7.2%

Q4FY22 Q1FY23 Q2FY23 Q3FY23

# Excluding interest reversal of ₹38 Cr in Q1FY23, Yield is 19% and NIM is 12.4%

Financials showing a healthy movement (2/2)

PPOP & PBT (₹ Cr)

+28%

110

141

PAT (₹ Cr)

+29%

-301

Q4FY22

Q1FY23

Q2FY23

Q3FY23

PPOP

PBT

ROA (%)

1.8%

+80 bps

3.8%

4.5%

Q4FY22

-220 Q1FY23

Q2FY23

Q3FY23

ROE (%)

+210 bps

4.1%

7.7%

9.8%

-14.2%

-29.8%

Q4FY22

Q1FY23

Q2FY23

Q3FY23

Q4FY22

Q1FY23

Q2FY23

Q3FY23

Consolidated Income Statement

Particulars (₹ Cr)

Revenue from Operations

Interest income

Net gain on fair value changes

Other Income

Total income from operations

Non-operational Income

Total income

Expenses

Finance cost

Net loss on financial assets and liabilities designated at fair value through profit or loss

Employee benefit expense

Depreciation and amortization expense

Other expenses

Total Expenses

Pre-Provision Operating Profit (PPOP)

Impairment on financial instruments and other provisions

Profit before Tax

Tax expense

Profit after tax

Q3 FY23

Q2 FY23

Q3 FY22

337.7

8.4

8.5

354.7

20.3

375.0

120.7

69.2

2.6

41.8

234.4

140.6

44.6

96.0

24.7

71.4

276.5

6.3

14.9

297.7

12.5

310.1

91.4

71.8

2.4

34.5

200.1

110.0

25.8

84.3

29.1

55.2

328.5

10.1

7.5

346.1

3.7

349.9

139.0

(0.0)

61.0

2.4

23.7

226.1

123.8

64.3

59.5

14.4

45.1

Consolidated Balance Sheet Net-worth increased to ₹2,961 Cr

ASSETS (₹ Cr)

Financial Assets

Cash and cash equivalents

Bank Balances other than cash and cash equivalents

Trade Receivables

Loan Portfolio

Investments

Other financial assets

Total Financial Assets

Non-Financial Assets

Inventories

Current tax assets (net)

Deferred tax assets (net)

Property, Plant and Equipment

Intangible assets

Goodwill

Other non-financial assets

Total Non-financial assets

Total Assets

Dec 31, 2022 Mar 31, 2022

1,024.6

139.0

30.5

727.2

475.1

20.1

6,509.3

5,518.4

84.2

122.1

2.4

74.5

LIABILITIES & EQUITY (₹ Cr) Financial Liabilities Debt Securities

Borrowings (Other than Debt Securities)

Subordinated Liabilities

Other Financial liabilities

Total Financial Liabilities

Non-Financial Liabilities Current Tax Liabilities (net)

7,909.8

6,817.7

Provisions

9.9

35.7

238.6

25.9

4.9

17.4

19.3

18.8

184.2

6.8

7.1

17.4

24.3

351.7

8,261.5

258.6

7,076.3

Other Non-Financial liabilities

Total Non-Financial Liabilities

Equity

Equity Share Capital

Other Equity

Equity attributable to shareholders of the company

Non-Controlling Interest

Total Equity

Total Liabilities and Equity

Dec 31, 2022 Mar 31, 2022

2,914.5

2,184.1

20.2

122.8

1,778.2

1,973.7

20.2

131.2

5,241.6

3,903.3

7.7

4.6

46.5

58.8

28.2

4.0

50.9

83.1

71.0

69.1

2,889.8

3,018.5

2,960.8

3,087.6

0.2

2,961.1

8,261.5

2.4

3,089.9

7,076.3

Annexure

Stable credit rating with comfortable liquidity position

Positive ALM^ (₹ Cr)

Rating Instrument

Rating Agency

Rating

Year

2,560

2,102

1,802

1,585

Assets

Liabilites

Bank Facilities / NCD’s

CRISIL/ ICRA

A Stable/ A- Stable

Sep 2022

Bank Facilities / NCD’s/ MLD’s

India-Ra

A Stable

Aug 2022

Bank Facilities/NCD's/ MLD's

India-Ra

A RWN

Jun 2022

Bank Facilities/NCD's/ MLD's

ICRA/India-Ra

A RWN/A-* May 2022

Bank Facilities

CRISIL

Apr 2022

217

Bank Facilities / NCD’s/ MLD’s

Ind-Ra/ICRA

A / A-*

Mar 2022

1,509

1,255

1,078

388

408

525

294

352

upto 1m# 1m to 2m 2m to 3m 3m to 6m 6m to 12m 1Y to 3Y 3Y to 5Y Over 5Y

Bank Facilities / NCD’s/ MLD’s

Ind-Ra

A / A-

Dec 2021

•

Positive ALM on cumulative basis with assets maturing faster than liabilities

Closing free cash and bank balance (Rs. 1,025 Cr as on 31 Dec), sufficient to meet future liquidity needs.

^Excludes DA amounting to 203 crs *ratings under watch with developing implications; #cash and cash equivalents (incl FDs)

Bank Facilities / NCD’s/ MLD’s

CRISIL/ ICRA

A / A-*

Nov 2021

Bank Facilities

Bank Facilities / NCD’s/ MLD’s

Bank Facilities / NCD’s

CRISIL

Ind-Ra

ICRA

A-

Jul 2021

Dec 2020

Mar 2019

Spandana Sphoorty Financial Limited

….Committed to low-income households

THANK YOU

Name/Title – Q2FY23

Years

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