AU Small Finance Bank Limited — Q4 FY25
AU Small Finance Bank delivered a resilient performance in FY25 despite a challenging macro environment.
neutral
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.
75%Questions answered2Evaded / deflected12Questions audited
Answered
High priority
Will AU cut deposit rates in line with system after 50 bps repo cut?
Asked by Ranish, ICICI Bank
Management gave specific numbers on rate cuts already implemented.
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Question
Post the 50 basis point of rate cut, we have already seen a large interest bank sort of rationalizing the rate. Are we not planning to cut rates in line with the system?
Sanjay Agarwal, Founder, Managing Director, and CEO
We already have cut down on our term deposit rates by 25 basis points. We already have rationalized our savings account buckets. We are not giving now the peak rate around savings is now 7% instead of 7.25%.
Evasive
High priority
Will NIM sustain between 5.5%-6% in FY26?
Asked by Ranish, ICICI Bank
Management refused to give a specific NIM guidance, citing uncertainty.
no number givendeferred to future
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Question
Broadly, our NIM should sustain between 5.5% - 6% in FY 2026, or how should we look at it from the current level of 5.8%?
Sanjay Agarwal and Gaurav Jain
If you ask me as of now, the next year, the lever is on the credit cost. The challenge is on NIMs. As of now, it's so difficult to predict whether we'll go down by 10 basis points or 20 basis points or 30 basis points.
Answered
High priority
Will credit cost remain elevated in coming quarters due to MFI and unsecured?
Asked by Kunal Shah, Citigroup
Management gave a clear trajectory of declining credit cost.
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Question
Would that mean that credit cost over the next couple of quarters will still continue to be elevated?
Rajeev Yadav, Deputy CEO
Fundamentally, no year change. As I said last time, we expected that the Q3 and Q4 of last year would be the highest level of credit cost as a quarter basis. They will gradually decline from a Q1 to a Q2 perspective.
Answered
High priority
What is the timeline for universal bank license?
Asked by Kunal Shah, Citigroup
Management gave a specific timeline.
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Question
When can we expect the universal bank license?
Sanjay Agarwal, Founder, Managing Director, and CEO
I would say this calendar year.
Declined
Medium priority
How much of INR 894 crore slippage was from Wheels portfolio?
Asked by Piran Engineer, CLSA
Management declined to provide the requested breakdown.
refused to disclose
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Question
Out of this INR 894 crore with which this quarter, how much would be from the Wheels portfolio?
Gaurav Jain, President of Finance and Strategy
We do not give individually portfolio-wise data.
Partial answer
Medium priority
Why did bulk deposits grow strongly despite comfortable CD ratio?
Asked by Pritesh Bumb, DAM Capital Advisors
Management attributed growth to system pressure but did not explain strategic intent.
no specific reason given
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Question
Any strategic intent there?
Sanjay Agarwal, Founder, Managing Director, and CEO
Not really. I think the whole system was like this. The CASA and CASA remain under pressure, right? We also have grown our retail deposits, right? I think the heavy lifting has been done through wholesale deposits.
Answered
High priority
Will 2-2.5x system growth guidance hold after universal bank license?
Asked by Anand Swaminathan, Bank of America
Management clarified that growth guidance is not tied to license but to size.
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Question
When you get your universal bank license, does this guidance around 2-2.5, the system growth still hold?
Sanjay Agarwal, Founder, Managing Director, and CEO
There is nothing as such rule or compulsion from anybody to grow in that kind of numbers. It is based on the positioning of us that we are around INR 1.5 lakh crore of assets. We can grow in the range of 25%.
Answered
High priority
When do you expect to raise capital next?
Asked by Anand Swaminathan, Bank of America
Management linked capital raise to universal license timeline.
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Question
When do you next expect to raise capital? Will there be this financial year or next financial year?
Sanjay Agarwal, Founder, Managing Director, and CEO
We want to relate that with our universal license decision. Yeah. So it will be after universal bank license you get? That's our desire.
Answered
High priority
What changes were made to credit card business and when will sourcing pick up?
Asked by Nidhesh Jain, Investec Bank
Management detailed changes and gave a timeline for improvement.
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Question
What all changes we have made on the credit card in the last 12 months, and when should we start seeing increase in new credit card sourcing?
Sanjay Agarwal, Founder, Managing Director, and CEO
We have taken complete course correction. We have put in a lot many gated conditions. We also have not allowing customers to misuse the card. You will see that issuance coming up to be maybe around 20,000 per month maybe post-September.
Answered
High priority
How comfortable are you with ROA guidance for FY27 given recent turbulence?
Asked by Nithin Agarwal, Motilal Oswal Financial Services Ltd
Management reaffirmed ROA guidance with supporting math.
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Question
How comfortable do you feel to meet this guidance? Do you foresee any risk to this?
Sanjay Agarwal, Founder, Managing Director, and CEO
Next year, which is 2026-2027, I'm pretty sure that whatever we have guided you in a year back should get utilized. I think put all together, if you put all the math in place, we are above 1.8.
Answered
High priority
How much more credit cost provision is left in credit card book?
Asked by Rahul Jain, Goldman Sachs
Management stated no further provisions needed.
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Question
In this quarter, you already made INR 150 crore of provision. How much more is left on you to interest share more color on SMA 1, SMA 2 book in the credit card space?
Sanjay Agarwal, Founder, Managing Director, and CEO
I do not think that any specific provision is required from here onwards to really address any additional credit card cost.
Partial answer
Medium priority
What is the collection trend in MFI in April?
Asked by Ashlesh Sonje, Kotak Securities
Management gave qualitative confidence but no exact April collection figure.
no specific April number given
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Question
If you can share some color on collections in the microfinance portfolio in the month of April, whether that 99.2% number in March has gone down to, let's say, 96%-97%, or it is still holding up?
Rajeev Yadav, Deputy CEO
I am fairly confident that Q1 will be better than Q4 year of the breakup of all the numbers across quarters. Q4 was 98.7. I expect clearly Q1 to be better. We are tracking April quite well at this point of time.