Shares of Utkarsh Small Finance Bank fell nearly 1% to Rs 50.75 on August 9, although the bank released strong quarterly figures.
Quarterly net profit increased 20.1% YoY to Rs 107.5 Rs crore, thanks to lower provisions and provisions. Net interest income – the difference between how much interest a bank earns and what it pays depositors – grew 21% year-on-year. However, the bank’s net profit margin for the quarter was lower at 9.2% from 9.7% previously. The bank expects the performance of advances to improve in the coming quarters with interest rate adjustments in the microfinance sector, which is the bank’s lending segment. Operating profit is slightly higher at Rs 221 crore from Rs 213 crore. Provisions and provisions are lower at Rs 77 crore compared to Rs 91 crore.
Its loan portfolio grew 31.4% year-on-year to reach Rs 14,394 crore at the end of June, with the microfinance category accounting for 63% of that. Bank deposits increased 36% year-on-year to Rs 13,967 crore. Its ratio of total bad assets stood at 3.13% at the end of June compared with 3.23% three months earlier. Total NPA was 5.73% a year ago.
management comment
Speaking about the results, Govind Singh, MD and CEO, Utkarsh Small Finance Bank said: “We are seeing a healthy expansion of our franchise into finance. micro and other retail lending i.e. MSME, housing and wheel (auto) segment as well as deposit building .-at the top Our focus is on consistency on performance which makes we focus on productivity and performance with the level of detail tied to our Business as Usual model.
He said the Rs 500 billion raised in the recent IPO was enough to fund growth plans, adding that return on assets and return on equity stood at 2, respectively. 3% and 21.1% in the quarter.
Stock performance
Utkarsh Small Finance Bank is a recent stock listing. Shares opened 60% above the issue price on the July 21 trading day due to high IPO registrations and bullish market conditions. The IPO price range for the stock is Rs 23 to 25.
