Spandana Sphoorty Financial Ltd. (SPANDANA) AI Stock Analysis

• Market Cap: ₹18.39B
• Dividend Yield: N/A
• Average Volume (3M): 15.73K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.58
• Revenue Growth: -45.13%
• EPS Growth: -1646.01%
• Country: IN
• Employees: 13,097
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): -11.88
• Shares Outstanding: 88,639,500
• 10 Day Avg. Volume: 7,350
• 30 Day Avg. Volume: 15,734
• PEG Ratio: <0.01
• Price to Book (P/B): 0.66
• Price to Sales (P/S): 0.81
• P/FCF Ratio: -1.34
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): -79.64
• Revenue Forecast (FY): ₹6.52B

• Rating: 48 Neutral
• Price Target: ₹205.00 ▼(-21.41% Downside)
• Action: Reiterated Date: 11/15/25
• Date: Action: Reiterated 11/15/25

Spandana Sphoorty Financial Ltd. shows strong revenue growth but is hindered by significant profitability and cash flow challenges, reflected in a low financial performance score. Technical indicators suggest a positive trend, but valuation concerns due to negative earnings and lack of dividends weigh heavily on the overall score.

Positive Factors

Focused microfinance business model

A focused microfinance model targeting underserved, low-income borrowers is a durable structural advantage. Small-ticket, group-based lending supports stable demand, strong client relationships and repeat lending, enabling predictable portfolio growth and deep local market penetration over the medium term.

Large field workforce and distribution

A sizable field workforce and distribution footprint is a lasting operational asset for microfinance. Local staff improve underwriting, collection efficiency and customer touchpoints, supporting scalable disbursements, lower incremental origination costs and better credit monitoring across diverse rural markets.

Historical revenue growth trajectory

Sustained revenue growth over multiple years indicates persistent demand for microloans and the company's ability to scale lending. This revenue base can underpin future net interest income recovery if funding and cost structures are improved, giving management a runway to restore profitability.

Negative Factors

High leverage and weak capital structure

Elevated debt-to-equity raises financial risk and reduces flexibility. High leverage increases interest expense sensitivity to funding cost moves, limits capacity to absorb credit shocks, and constrains strategic investments or capital raises without diluting equity or increasing funding costs.

Negative operating and free cash flow

Persistent negative operating and free cash flow undermines liquidity and forces dependence on external funding. Over months, this can restrict loan growth, raise refinancing risk, and elevate funding costs, making it harder to convert revenue growth into sustainable, internally funded expansion.

Profitability deterioration in 2025

A shift to negative net margins signals structural pressure from rising credit costs, funding expense or operating inefficiency. Continued losses erode equity, hurt return on capital and limit the company's ability to self-finance, requiring operational fixes or capital restructuring to restore long-term viability.

Spandana Sphoorty Financial Ltd. Business Overview & Revenue Model

Company Description

Spandana Sphoorty Financial Limited engages in the microfinance business in India. The company provides income generation loans for low-income households; loans against the property; personal loans for business development, purchase of livestock, house construction/renovation, and other needs; gold loans for agriculture, business, and short-term liquidity needs; and interim loans, as well as business loans. It also offers loans for women to expand their existing income-generating activities, smoothening household cash flows, and acquiring productive assets. The company serves low-income customers in semi-urban and rural areas with approximately 982 branches. Spandana Sphoorty Financial Limited was founded in 1998 and is based in Hyderabad, India.

How the Company Makes Money

SPANDANA makes money primarily by earning interest income on its loan portfolio. Its core revenue stream is the spread between (a) the interest and fees it charges borrowers on microfinance loans and (b) its own cost of funds (borrowings from banks/financial institutions, market instruments, and other funding sources). In addition to interest on loans, it can earn fee-based income related to loan processing and other permissible charges associated with originating and servicing loans; if specific fee components are not separately disclosed, this item is null. The company’s earnings are influenced by (i) loan disbursement and portfolio growth (higher average assets under management generally increases interest income), (ii) collection efficiency and credit costs (defaults, write-offs, and provisioning reduce profitability), (iii) funding mix and interest rates (changes in borrowing costs affect net interest margin), and (iv) operating efficiency in field operations (employee and branch costs affect the cost-to-income profile). Material partnerships such as named co-lending/BC arrangements are null if not explicitly identified in publicly available company disclosures referenced here.

Spandana Sphoorty Financial Ltd. Financial Statement Overview

Summary

Spandana Sphoorty Financial Ltd. demonstrates strong revenue growth but faces significant challenges in profitability and cash flow management. The high leverage and negative net income in 2025 are concerning, highlighting the need for strategic financial restructuring.

Income Statement

Spandana Sphoorty Financial Ltd. shows significant revenue growth from 2020 to 2025 but faces challenges with profitability. The net profit margin turned negative in 2025, pointing to potential inefficiencies or increased costs. The gross profit margin is reasonable, but the decline in EBIT margin over time indicates rising operational expenses. Despite a positive trajectory in revenue, the company must address its declining profitability.

Balance Sheet

The balance sheet indicates a high debt-to-equity ratio, signaling considerable leverage and potential financial risk. The equity ratio has decreased over the years, pointing to increased reliance on debt. Return on equity was positive in earlier years but turned negative in 2025 due to net losses. The company needs to improve its capital structure to enhance stability.

Cash Flow

Cash flow analysis reveals negative operating cash flow in recent years, impacting the company's liquidity position. Free cash flow remains negative, suggesting challenges in generating cash from operations. The operating cash flow to net income ratio is unfavorable, indicating inefficiency in converting profits into cash. Improving cash flow generation is critical for future growth.

Breakdown	TTM	Mar 2025	Mar 2024	Mar 2023	Jun 2022	Mar 2021
Income Statement
Total Revenue	13.83B	21.60B	22.16B	12.68B	13.85B	13.55B
Gross Profit	2.89B	6.85B	8.83B	5.52B	6.17B	8.00B
EBITDA	-18.76B	-13.55B	6.92B	296.70M	4.91B	2.26B
Net Income	-14.84B	-10.35B	5.01B	123.10M	694.68M	1.45B
Balance Sheet
Total Assets	56.79B	84.94B	133.83B	93.83B	70.76B	85.77B
Cash, Cash Equivalents and Short-Term Investments	10.58B	20.04B	17.98B	10.93B	11.33B	13.10B
Total Debt	32.89B	56.56B	94.25B	60.74B	37.72B	53.73B
Total Liabilities	34.52B	58.60B	97.38B	62.83B	39.86B	58.26B
Stockholders Equity	22.27B	26.33B	36.45B	30.99B	30.88B	27.49B
Cash Flow
Free Cash Flow	13.27B	-12.98B	-27.33B	-21.84B	8.49B	-17.70B
Operating Cash Flow	13.30B	-12.76B	-27.07B	-21.71B	8.63B	-17.54B
Investing Cash Flow	1.24B	48.28B	863.90M	-1.75B	362.18M	4.82B
Financing Cash Flow	-21.86B	-37.12B	32.05B	24.33B	-13.07B	23.48B

Spandana Sphoorty Financial Ltd. Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 260.85
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:SPANDANA, the sentiment is Negative. The current price of 260.85 is above the 20-day moving average (MA) of 232.95, above the 50-day MA of 242.99, and above the 200-day MA of 256.12, indicating a bearish trend. The MACD of -12.06 indicates Positive momentum. The RSI at 31.03 is Neutral, neither overbought nor oversold. The STOCH value of 27.51 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for IN:SPANDANA.

Spandana Sphoorty Financial Ltd. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
PAISALO	65 Neutral	₹31.82B	12.44	―	0.29%	11.75%	-6.52%
ARMANFIN	61 Neutral	₹15.86B	18.43	―	―	-6.03%	-100.77%
MUTHOOTMF	51 Neutral	₹25.69B	19.28	―	―	-10.17%	-181.71%
SURYODAY	51 Neutral	₹13.14B	10.24	―	―	―	―
SPANDANA	48 Neutral	₹18.39B	-5.67	―	―	-45.13%	-1646.01%
CENTRUM	46 Neutral	₹11.91B	-3.33	―	―	47.88%	11.61%

Spandana Sphoorty Financial Ltd. Corporate Events

Spandana Sphoorty Uploads Q3 and 9M FY26 Earnings Call Audio for Investors

Spandana Sphoorty Financial Limited has notified stock exchanges that the audio recording of its investors and analysts conference call discussing the unaudited consolidated and standalone financial results for the third quarter and nine months ended 31 December 2025 has been uploaded to the company’s website. The firm added that a detailed transcript of the call will be filed with the exchanges and made available online in due course, improving disclosure and access to its financial commentary for shareholders and market participants.

Spandana Sphoorty Files Monitoring Report on ₹400 Crore Rights Issue Utilisation

Spandana Sphoorty Financial Limited has disclosed that CARE Ratings Limited, acting as the appointed monitoring agency, has submitted its report for the quarter ended 31 December 2025 on the utilisation of proceeds from the company’s Rs 400 crore rights issue of equity shares. The filing, made to both BSE and NSE in compliance with SEBI listing and capital-raising regulations, signals that the deployment of rights issue funds is being independently reviewed and formally reported, underscoring governance, regulatory adherence and transparency for investors and other stakeholders; the company has also made the monitoring report available on its website for public access.