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Revenue
₹37,69,04,180 Cr
verified against source
Revenue YoY
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reported change
EBITDA
Pending
latest reported figure
Source
nse xbrl
record provenance
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Quarter read
What the record says.
AU Small Finance Bank reported a steady Q1 FY25, with the board approving a universal bank application. The bank maintained a cautious deposit strategy, keeping the book flat at INR 97,290 crore to optimize costs, resulting in a 7 bps reduction in cost of funds to 7.03%. Disbursements reached 20% of the INR 60,000+ crore annual target, with yields improving to 15.8%, up 250 bps QoQ. Asset quality remained stable, with annualized credit cost at 1.28%, within the guided 1.10-1.15% range for the year. Management reiterated FY25 ROA guidance of 1.6%, though margin pressure from deposit repricing is expected. Key risks include rising competition in deposits and potential stress in microfinance, where a 3% credit cost provision is being built. The universal bank license could enhance brand trust and deposit franchise, but near-term cost of funds may rise by 35-40 bps.
Colored figures show movement against the previous available record.
Guidance to track
- Management aims to grow deposits by 25% this fiscal, with INR 25,000 crore incremental deposits needed over the next nine months.
- Management reiterated ROA guidance of 1.6% for FY25, with potential upside if deposit costs remain favorable.
- Annualized credit cost expected to be in the guided range of 1.10-1.15%, including 3% provision on microfinance book.
- Management expects cost-to-income ratio to be around 61-62% for the full year, with Q1 being seasonally lower.
Risks flagged
- Intense competition for deposits, especially from mid-sized banks, could push cost of funds higher than guided 35-40 bps increase.
- Collection efficiency in microfinance has dipped due to heatwave and elections, with over-leverage concerns in the sector.
- Industry-wide stress in unsecured lending could impact credit card portfolio, though management has tightened underwriting.
- The application process and approval timeline for universal bank license are uncertain, with no specific guidance provided.
Key quotes
- We really want to be more safe than aggressive there.
- Our core endeavor remain raising low cost, stable retail deposits with high customer engagement.
- I think the market, the intensity has gone down because the rate has gone up.
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