Earnings Review
Ujjivan Small Fin Bk PAT falls 48% on surge in provisions
This story was originally published at 16:42 IST on 17 October 2025
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--Ujjivan Small Finance Bank Jul-Sept net profit INR 1.22 bln
--Analysts saw Ujjivan Small Finance Bank Jul-Sept net profit INR 1.13 bln
--Ujjivan Small Finance Bank Jul-Sept PAT INR 1.22 bln vs INR 2.33 bln
--Ujjivan Small Fin Bk Jul-Sept total income INR 19.39 bln vs INR 18.20 bln
--Ujjivan Small Fin Bank Jul-Sept provisions INR 2.35 bln vs INR 1.51 bln
--Ujjivan Small Fin Bk gross NPA ratio 2.45% as on Sept 30 vs 2.52% qtr ago
--Ujjivan Small Fin Bk net NPA ratio 0.67% as on Sept 30 vs 0.70% qtr ago
--Ujjivan Small Fin Bk Basel II capital adequacy ratio 21.36% as on Sept 30
--Ujjivan Small Finance Bank Apr-Sept PAT INR 2.25 bln vs INR 5.34 bln
--Ujjivan Small Fin Bk Apr-Sept total income INR 38.06 bln vs INR 35.94 bln
By Adhithya Aji
MUMBAI – Ujjivan Small Finance Bank Ltd.'s net profit for the September quarter fell as the bank's provisions rose sharply on year. Despite the fall in the bank's bottom line, it exceeded the Street's estimate.
Ujjivan Small Finance Bank reported a net profit of INR 1.22 billion for the September quarter, down nearly 48% on year but up 18% sequentially. Analysts estimated the net profit at INR 1.13 billion. The bank's provisions rose 56% on year and 4.5% on quarter to INR 2.35 billion.
On the asset quality front, the gross non-performing assets ratio fell marginally to 2.45% as on Sept. 30 from 2.52% a quarter ago. The net non-performing asset ratio declined to 0.67% as on Sept. 30 from 0.70% reported in the previous quarter.
Rise in expenditure also weighed on the bank's profit. The small finance bank's operating expenditure rose over 13% on year to INR 7.83 billion. Of the operating expenditure, employee cost increased over 18% on year and nearly 6% on quarter to INR 4.35 billion.
The capital adequacy ratio under Basel II stood at 21.36%, down from 22.77% in the previous quarter and 23.38% a year earlier. The bank's cost of funds dropped to 7.3% from 7.6% in the June quarter. The small finance bank's total income in Jul-Sept was INR 19.39, compared to INR 18.20 billion a year ago.
On the business side, total deposits of the bank rose to INR 392 billion in the September quarter, which is an increase of 15.1% on year and 1.5% sequentially. The current account savings account deposits of the bank was at INR 107 billion, up 22% on year and nearly 15% on quarter. The bank reported its highest ever disbursements at INR 79 billion, up nearly 48% on year and 21% on quarter. Gross loan book of the bank grew 14% on year to INR 345 billion and secured loan book grew 53% on year to INR 16.17 billion.
The Bengaluru-based bank's income rose 6.7% on quarter to INR 16.8 billion. The net interest income – the difference between its interest earned and expended – rose 7.7% to INR 9.22 billion for the reporting quarter, which reversed the trend of last three quarters. The net interest margin contracted 127 basis points to 7.9%. The return on assets fell 117 bps to 1% and return on equity fell 797 bps to 7.7% for the September quarter.
Ujjivan's net profit for the first half of 2025-26 (Apr-Mar) was INR 2.25 billion, down 58% on year. The total income of the bank for the same period was INR 38.06 billion, up nearly 6% on year. The net interest income for Apr-Sept was INR 17.78 billion, up 5.7% on year, and the net interest margin contracted 141 bps for the same period.
The group loans constituted 38% of the gross loan book and was at INR 131 billion, down 12% on year, as of Sept. 30. The housing segment, which constituted 22% of gross loan book, was at INR 76.56 billion, up 42% on year.
On Friday, shares of the bank ended 1.8% higher at INR 568.80 on the National Stock Exchange. End
Edited by Tanima Banerjee
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