Ujjivan Small Finance Bank (UJJIVANSFB) Q4 22/23 earnings summary

Executive summary

• FY23 marked a strong turnaround: PAT reached ₹1,100 crore versus a ₹415 crore loss in FY22; total income rose 50% YoY to ₹4,754 crore.

• Growth and recovery advanced together: gross loan book rose 33% to ₹24,085 crore, deposits rose 40% to ₹25,538 crore, and gross NPA fell to 2.6% of gross loan book.

Financial highlights

• Net interest income increased 52% YoY to ₹2,698 crore; pre-provision operating profit rose 133% to ₹1,485 crore.

• Q4FY23 PAT was ₹310 crore, up 145% YoY; Q4 PPOP was ₹411 crore, up 70% YoY.

• Interest income on advances grew 44% to ₹3,708 crore; advance yield was 18.4% versus 16.6% in FY22.

• Operating costs rose 20% YoY; cost-to-income ratio improved to 54.8% from 70.1%, while credit cost fell to ₹18 crore from ₹1,164 crore.

• Bad-debt recovery income rose 187% to ₹135 crore; third-party distribution revenue grew 56% to ₹42 crore.

Outlook and guidance

• FY24 targets: gross loan book growth of 25% or higher, deposit growth of 30% or higher, credit costs below 100 bps, and ROE of around 22% or higher.

• Plans call for 100–104 new branches, including entry into Andhra Pradesh; investment priorities include technology, digital deposits, video banking, and customer acquisition.

• Growth priorities include MicroBanking and secured lending; MSME and vehicle finance are expected to gain traction, alongside CASA and granular retail deposits.

• Slippages were beginning to normalise late in FY23; bad-debt recoveries are expected to continue in FY24.