Earnings Review
Ujjivan Small Fin Bank PAT slumps 75% as provisions triple
This story was originally published at 16:19 IST on 30 April 2025
Register to read our real-time news.Informist, Wednesday, Apr. 30, 2025
Please click here to read all liners published on this story
--Ujjivan Small Finance Bank Jan-Mar net profit INR 833.9 mln
--Analysts saw Ujjivan Small Finance Bank Jan-Mar net profit INR 725 mln
--Ujjivan Small Fin Bank Jan-Mar PAT INR 833.9 mln vs INR 3.30 bln year ago
--Ujjivan Small Fin Bk Jan-Mar total income INR 18.43 bln vs INR 17.65 bln
--Ujjivan Small Fin Bk Jan-Mar provisions INR 2.65 bln vs INR 790 mln yr ago
--Ujjivan Small Fin Bank FY25 net profit INR 7.26 bln vs INR 12.82 bln
--Ujjivan Small Fin Bk FY25 total income INR 72.01 bln vs INR 64.64 bln
--Ujjivan Small Fin Bank Basel II capital adequacy ratio 23.10% as on Mar 31
--Ujjivan Small Fin Bank gross NPA ratio 2.18% on Mar 31 vs 2.68% qtr ago
--Ujjivan Small Fin Bank net NPA ratio 0.49% as on Mar 31, vs 0.56% qtr ago
--Ujjivan Small Fin Bk Jan-Mar NII INR 8.64 bln vs INR 9.34 bln year ago
--Ujjivan Small Fin Bk Jan-Mar NIM 8.3% vs 8.6% in Oct-Dec, 9.4% yr ago
--Ujjivan Small Fin Bk provision coverage ratio at 78% as on Mar 31
--Ujjivan Small Fin Bk gross loan book INR 321.22 bln on Mar 31, up 8% YoY
--Ujjivan Small Fin Bk total deposits INR 376.30 bln on Mar 31, up 20% YoY
--Ujjivan Small Fin Bk CASA ratio at 25.5% as on Mar 31, up 43 bps on qtr
By Ashna Mariam George
MUMBAI – Ujjivan Small Finance Bank's net profit for the March quarter slumped expectedly on a sharp rise in provisions. The Bengaluru-headquartered bank's bottom line for Jan-Mar was INR 833.90 million, down 75% on year, marginally beating analysts' expectations of INR 725 million. Shares of the lender were down 3.5% at INR 42.36 on the National Stock Exchange at 1415 IST, and ended 2.9% lower at INR 42.63.
In Jan-Mar, the small finance bank's provisions and contingencies more than tripled from a year ago to INR 2.65 billion, with collection efficiency for up to one equated monthly instalment in March down at 96.4% from 98.0% a year ago, although it was up from December's 95.9%.
"The Micro Banking Bucket-X Collection Efficiency in all states other than Karnataka showed consistent improvement, reaching 99.6% in March," a press release from the bank quoted Managing Director and Chief Executive Officer Sanjeev Nautiyal saying. "The overall Bucket-X collection efficiency reached 99.5% in March despite Karnataka registering only 98.7%. The branch- and customer-specific interventions were pivotal in managing the portfolio making it one of the best in the industry in the current situation."
Weak net interest income also weighed on the bank's quarterly profit. In Jan-Mar, Ujjivan Small Finance Bank's net interest income fell 7% on year to INR 8.64 billion, with the net interest margin down at 8.3% from 8.6% in Oct-Dec and 9.4% a year ago.
The lender's net interest income fell even as gross advances at the end of March were up 8% on year at INR 321.22 billion, with the microfinance business seeing a revival in Jan-Mar with disbursements rising 38% from Oct-Dec.
"Group Loans disbursement for Q4 (Jan-Mar) was led by repeat customers and growth in upcoming quarters would see higher number of New-to-Bank customers," the bank said. Total disbursals in Jan-Mar were up 11% at INR 74.40 billion, with micro group loans being the largest contributor at INR 27.87 billion despite falling 25% on year. At INR 39.82 billion, majority of loans disbursed in Jan-Mar were unsecured. But the share of secured loans in the gross loan book was 44% as of Mar. 31, up from 39% as of Dec. 31.
On the deposit side, the small finance bank recorded a growth of 20%, to INR 376.30 billion, as of Mar. 31, with the current account savings account ratio up 43 basis points from the end of December at 25.5%. The bank's cost of funds for the quarter stood at 7.6%, unchanged from a quarter ago but higher than 7.2% a year ago.
The bank's total income in Jan-Mar was INR 18.43 billion, up 4% on year. For the financial year 2024-25 (Apr-Mar), the total income stood at INR 72.01 billion, up 11%, with the net profit down 43% at INR 7.26 billion.
Asset quality-wise, Ujjivan Small Finance Bank's gross bad loans ratio improved to 2.18% as of Mar. 31 from 2.68% a quarter ago and 2.23% last year. The net non-performing assets ratio, while down 7 bps sequentially at 0.49%, was up from 0.28% a year ago.
"For the secured portfolio quality, Housing GNPA (gross non-performing assets ratio) reduced YoY (year-on-year) to 1.1% as of March from 1.5%. MSME (micro, small, and medium enterprises) saw drastic improvement with GNPA reducing to 5.5% as of March from 8.4% as of March 2024," Nautiyal said.
As of Mar. 31, the bank carried a floating provision of INR 1.81 billion, of which INR 1.30 billion is used to calculate the net non-performing assets and provision coverage ratio. "Also, Rs. 3,000 lakh (INR 300 million) is considered as Tier II capital and Rs. 2,067 lakh (INR 206.7 million) is unutilised, which is available for utilisation in the future for calculating the net NPA and provision coverage ratio. Had the Bank reckoned the remaining Rs. 2,067 lakh for calculating the Net NPA, the Net NPA would be 0.42% and the Provision Coverage Ratio would have increased from 78.10% to 81.07% as at Mar. 31," the bank said in its notes to accounts. The Basel-II capital adequacy ratio was 23.10% as of Mar. 31. End
Edited by Rajeev Pai
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
To read more please subscribe
Share this Story:
