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Informist, Wednesday, Apr. 29, 2026

By Durgesh Nandan

MUMBAI – Equitas Small Finance Bank is expected to report more than three-fold on-year growth in its net profit for the March quarter due to healthy growth in advances and deposits, according to brokerages tracking the bank. Its net interest income is also expected to increase moderately from the year-ago period, brokerages added. 

The small finance bank is likely to report a net profit of nearly INR 1.47 billion, up over 249% on year and more than 63% on quarter, according to the average of estimates from eight brokerages. The highest estimate for Equitas Small Finance Bank's net profit for the March quarter is INR 1.57 billion by Motilal Oswal Financial Services Ltd., while the lowest estimate is INR 1.24 billion by Kotak Securities Ltd.

The bank's net interest income is expected at INR 9.32 billion for the reporting quarter, up over 12% on year, according to the average of estimates. On a sequential basis, it is likely to rise over 9%. Estimates for the bank's net interest income range from a high of INR 9.79 billion by YES Securities (India) Ltd. to a low of INR 8.99 billion by Emkay Global Financial Services Ltd.

Most brokerages expect the bank's net interest margin to report healthy sequential growth, but fall year-on-year. Net interest margin is projected to fall in the range of 5-52 basis points on year, as per brokerage estimates. However, Kotak Securities said it is likely to rise 3 bps on year. Sequentially, it is expected to rise 2-30 bps, as per five brokerages. 

"NIMs are likely to expand with expansion in yields as MFI (microfinance institution) book is expected to show healthy growth coupled with moderation in CoF (cost of funds)," Equirus said.

Due to a rise in the net interest margin by 13 bps, the bank is expected to report an improvement in profit after tax, while credit costs are also expected to decline, Motilal Oswal Financial Services Ltd. said in its report. "We expect loan growth to remain robust (at 16.9% YoY/6.2% QoQ), led by healthy growth in MFI as well as used VF (vehicle finance) book," Motilal Oswal said.

The bank is expected to report healthy growth in advances, seen rising sharply on year and moderately on quarter. Advances are expected to rise in the range of 16-22% on year, according to brokerages.

Deposits are likely to grow moderately, both on year and sequentially. It is estimated to rise in the 5-8% band. Growth in the bank's credit costs are expected to moderate to 1.4%, supported by improving collection efficiency and asset quality trends, according to Equirus.

The bank's gross advances were INR 461.83 billion at the end of 2025-26 (Apr-Mar), up 21.6% on year, according to provisional figures shared by the bank earlier this month. Total deposits were INR 465.33 billion at the end of the year, up around 8%. Also, the current account savings account ratio fell to 26% as of Mar. 31 from 30% as of Dec. 31, according to data released by the bank.

During the March quarter, the Reserve Bank of India granted approval to ICICI Prudential Asset Management Co. Ltd. and group entities of ICICI Bank to acquire up to 9.95% stake in Equitas Small Finance Bank.

The company will detail its March quarter earnings on Thursday. At 1129 IST, shares of Equitas Small Finance Bank were up over 3% at INR 68.60 on the National Stock Exchange. The company had reported a net profit of INR 900.28 million for the December quarter on total income of INR 19.81 billion. Since reporting its December quarter earnings, shares of the company have fallen over 4%.

Of eight brokerage reports on the bank available with Informist, five have a 'buy' or equivalent recommendation on the stock with an average target price of INR 76 per share. This is nearly 11% higher than its current market price. One brokerage has a 'hold' recommendation on the stock, while two have a 'sell' recommendation.

The following are the Jan-Mar earnings estimates, in INR billion, for Equitas Small Finance Bank Ltd. from eight brokerages in descending order of the net profit estimate:

End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Tanima Banerjee

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