AU Small Finance Bank Limited — Q3 FY26
AU Small Finance Bank delivered a strong Q3 FY26 with PAT of INR 668 crore (excluding one-time provision of INR 20 crore, PAT was INR 682 crore, up 29% YoY).
bullish
high
Financial stats pending filing verification
Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
85%Questions answered0Evaded / deflected10Questions audited
Partial answer
High priority
Margins moving parts, funding mix, credit cost outlook
Asked by Akshay Jain, Autonomous
Management explained drivers but declined to give specific margin guidance.
no margin guidance givendeferred to future quarters
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Question
So my first question is on margins. So, can you explain the different moving parts on your margins? ... My second question is on funding mix. ... And lastly, on credit costs.
Gaurav Jain (Interim CFO) and Vivek Tripathi (Executive Director and Chief Credit Officer)
So there are three broad parts. The first is the improvement in cost of funds... The second is the benefit from CRR cut. And the third is your lower surplus liquidity...
Answered
High priority
Unsecured loan mix and cost-income ratio outlook
Asked by Nitin Aggarwal, Motilal Oswal
Management gave specific cost-income ratio guidance and discussed unsecured mix strategy.
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Question
One is on the mix of unsecured loans now... And the other question is around cost... how should we look at the cost-income ratio now?
Sanjay Agarwal (Founder, MD, CEO)
I think we want to be around the original guidance that it should be below 60%... ideally, we should be in the range of 56%-57% next year too.
Partial answer
Medium priority
Loan growth outlook and MBL performance
Asked by Jayant Kharote, Axis Capital
Management gave overall growth target but was vague on MBL specifics.
no specific MBL growth guidancedeferred to future
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Question
My first question is on the loan growth outlook for the next one or two years. And within that, specifically microbusiness loans...
Sanjay Agarwal (Founder, MD, CEO)
We want to be around 2.25 to 2.5 times to the nominal GDP... anything around 20%, 22% growth overall, we are targeting...
Answered
High priority
MFI credit cost and ROA trajectory
Asked by Kunal Shah, Citigroup
Management explained MFI credit cost drivers and reiterated 1.8% ROA target.
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Question
So the first question is on MFI credit cost in particular... And secondly, with respect to ROA... what are the further levers available in the near term?
Vivek Tripathi (Executive Director and Chief Credit Officer) and Sanjay Agarwal (Founder, MD, CEO)
Our collection efficiency has improved sharply... the large reduction of credit cost happened on account of lower slippages and higher coverage of guarantee...
Partial answer
High priority
NIM trajectory and product-level profitability
Asked by Speaker 16 (Vivek Jayal), ICICI Securities
Management discussed yield stability but avoided giving a NIM target.
no specific NIM guidancedeferred to annual results for product profitability
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Question
So in a normalized scenario, adding NIM should settle at 6%... where do you see NIM settling over the next couple of years?
Prince Tiwari (Head of IR) and Sanjay Agarwal (Founder, MD, CEO)
I think we are holding on to yields on the vehicle side... I don't really see yields going down very significantly...
Answered
Medium priority
MFI provisioning coverage and growth drivers
Asked by Pritesh Bumb, DAM Capital
Management explained provisioning policy and confirmed growth drivers.
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Question
One is the provisioning. Are we 100% provision on MFI today? ... The second question is on this Slide 30... is it safe to say that growth will be driven by these two segments?
Vivek Tripathi (Executive Director and Chief Credit Officer) and Gaurav Jain (Interim CFO)
We provide for only on an uncovered portion... PCR will be a function of where exactly the book is...
Answered
Medium priority
MFI recovery broad-based and gold loan overlap
Asked by Ankit Bihani, Nomura
Management clearly answered that recovery is broad-based and overlap is minimal.
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Question
Is the recent improvement in repayment behavior broad-based across the MFI book, or is it largely driven by borrowers with access to secure products such as gold loans?
Vivek Tripathi (Executive Director and Chief Credit Officer) and Gaurav Jain (Interim CFO)
The MFI recovery is a very, very broad-based recovery... the overlap between the gold loan and MFI book would be very, very minimal.
Answered
Medium priority
Margin impact of rate cut and growth strategy
Asked by Jignesh Shial, Ambit
Management gave specific details on rate cut pass-through and growth strategy.
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Question
So previous 25 basis points has been passed on, and the impact will be visible in 4Q... And second, just wanted to understand more on the growth part.
Gaurav Jain (Interim CFO) and Sanjay Agarwal (Founder, MD, CEO)
The December rate cut will get passed on over a period of four months... About 30% of your book gets impacted.
Answered
Medium priority
OPEX drivers and competitive landscape
Asked by Param Subramanian, Investec
Management provided detailed OPEX breakdown and competitive positioning.
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Question
First question is on the OPEX movement quarter on quarter. Could you give some broad color on the various segments... And just one last question... from a competitive landscape, how are you looking at things?
Gaurav Jain (Interim CFO) and Sanjay Agarwal (Founder, MD, CEO)
There are two drivers. One is the 20% quarter on quarter increase in disbursement... The second component is your headcount and touchpoints...
Partial answer
Low priority
Savings rate cuts and credit card portfolio
Asked by Bhavik Shah, InCred Capital
Management answered partially on savings cuts but avoided specifics on credit card.
declined to comment on further rate cutsdeferred credit card details
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Question
So what will be the proposal of book below Rs 1 lakh? ... And related to that, do we plan to further take savings cuts... And sir, I just wanted to check on your card portfolios.
Sanjay Agarwal (Founder, MD, CEO) and Gaurav Jain (Interim CFO)
The below 1 lakh is a very small amount... Further rate, I can't comment as of now...
Answered
Medium priority
MFI credit cost sustainability and CD ratio focus
Asked by Piran Engineer, CLSA
Management explained credit cost sustainability and CD ratio philosophy.
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Question
If collection efficiency is stable from year on, credit cost will be at this 30 basis points or so level... And just the next question... is the CD ratio now even a focal point anymore for RBI?
Vivek Tripathi (Executive Director and Chief Credit Officer) and Sanjay Agarwal (Founder, MD, CEO)
It's a game of improvement in collection efficiency... it should hold through the cycle... CD ratio is an important one... it's about self-governance.