1. At a Glance
Ujjivan Small Finance Bank (USFB) just posted a ₹103 Cr Q1 profit. Not bad… until you see that it’s down 65% YoY and 50% of it was “other income.” GNPA ticked up, margins fell off a cliff, and promoter holding dropped to 0%. Yeah, it’s giving “public sector vibes” now.
2. Introduction with Hook
If banks were reality shows, Ujjivan would be Indian Idol. It came from humble beginnings, hit high notes (₹1,281 Cr FY24 profit), and now… we’re in the “emotional montage” phase.
In Q1 FY26, loan book grew 11% YoY to ₹33,287 Cr. Deposits jumped 19% YoY to ₹38,619 Cr. But P&L? Think climax twist: Net Profit is down 58% YoY.
Meanwhile, the stock is trading at 16.7x P/E — cheaper than its peers, but maybe that’s a warning label, not a discount.
3. Business Model (WTF Do They Even Do?)
Basically, Ujjivan lends small amounts to people with even smaller credit histories. Their dream? Bring banking to the economically active poor — and maybe score a universal banking license along the way.
Here’s the TL;DR:
- Retail Loans: 85% (includes group loans, MSME, housing)
- Treasury: 12% (you know, where banks hide losses)
- Wholesale Banking: 3% (because someone had to pitch this to HNIs)
It’s like being a dhobi in a rainstorm — everyone hands you dirty laundry, but you have to clean it with limited water and zero margin for error.
4. Financials Overview
| Metric | FY25 | Q1 FY26 |
|---|---|---|
| Revenue | ₹6,354 Cr | ₹1,619 Cr |
| Net Profit | ₹726 Cr | ₹103 Cr |
| NIM (Est.) | ~8.5% | Slipping |
| Gross NPA % | 2.18% | 2.52% |
| Net NPA % | 0.49% | 0.70% |
| ROE | 12.4% | Annualized |
Q1 FY26 had a 24% QoQ profit growth… until you realize last quarter was an earnings faceplant. Ouch.
5. Valuation
a) P/E Method
- EPS TTM: ₹2.72
- CMP: ₹45.7
- P/E: 16.7x
- Fair Value Range (12x–18x): ₹32–₹49
b) P/BV Method
- Book Value: ₹31.4
- P/BV: 1.45x
- Fair Range (1.2x–2.0x P/BV): ₹37–₹63
Takeaway? It’s “fairly” priced if you think 2.5% NPAs are just a phase.
6. What’s Cooking – News, Triggers, Drama
- Universal Banking License Applied – because every SFB wants to grow up to be a real bank.
- Promoter Exit – From 73.5% to 0%. They didn’t just sell — they ghosted.
- Other Income – ₹898 Cr TTM. Where would this bank be without “not doing banking” revenue?
Also, investor calls now feel like quarterly TED Talks on optimism. We respect the hustle.
7. Balance Sheet
| Metric | FY24 | FY25 |
|---|---|---|
| Deposits | ₹31,462 Cr | ₹37,630 Cr |
| Borrowings | ₹2,171 Cr | ₹2,845 Cr |
| Advances (Loan Book) | ₹29,339 Cr | ₹33,287 Cr |
| Net Worth | ₹5,614 Cr | ₹6,083 Cr |
Key Insight: They’re growing, but net NPAs and provisioning trends feel like that one crack in your iPhone screen — harmless until one bad fall.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net CF |
|---|---|---|---|---|
| FY23 | ₹1,060 Cr | ₹-2,096 Cr | ₹1,186 Cr | ₹150 Cr |
| FY24 | ₹1,593 Cr | ₹-865 Cr | ₹-519 Cr | ₹210 Cr |
| FY25 | ₹2,028 Cr | ₹-1,793 Cr | ₹398 Cr | ₹633 Cr |
Commentary:
Operating cash flow is healthy, but financing cash flows zigzag like your drunk uncle after 11 PM. Still, net positive = alive and kicking.
9. Ratios – Sexy or Stressy?
| Ratio | Value |
|---|---|
| ROE | 12.4% |
| ROA | 1.65% |
| Gross NPA | 2.52% |
| Net NPA | 0.70% |
| CAR | 22.77% |
Verdict:
Capital Adequacy looks like a gym bro on protein shakes (22.77%). But NPAs inching up and falling margins scream “Yeh loan toh jaayega.”
10. P&L Breakdown – Show Me the Money
| Year | Revenue | Net Profit | EPS |
|---|---|---|---|
| FY23 | ₹4,165 Cr | ₹1,100 Cr | ₹5.63 |
| FY24 | ₹5,677 Cr | ₹1,281 Cr | ₹6.54 |
| FY25 | ₹6,354 Cr | ₹726 Cr | ₹3.75 |
Analysis:
FY25 EPS almost halved. TTM profit? Down to ₹528 Cr. The glory days might’ve taken a long lunch break.
11. Peer Comparison
| Name | Revenue | PAT | P/E | ROE |
|---|---|---|---|---|
| AU SFB | ₹16,673 Cr | ₹2,184 Cr | 25x | 14.2% |
| Jana SFB | ₹4,792 Cr | ₹432 Cr | 11x | 13.1% |
| Equitas SFB | ₹6,311 Cr | ₹147 Cr | 48x | 2.4% |
| Ujjivan SFB | ₹6,396 Cr | ₹528 Cr | 16.7x | 12.4% |
Key Line:
In this party of small finance banks, Ujjivan is the sensible guest — polite margins, decent ROE, but no more fireworks.
12. Miscellaneous – Shareholding, Promoters
| Category | Jun ’24 | Jun ’25 |
|---|---|---|
| Promoters | 0% | 0% |
| FIIs | 24.7% | 19.5% |
| DIIs | 7.3% | 16.8% |
| Public | 68.0% | 63.6% |
Notes:
- Promoter has exited stage left. Retail + DII now run the show.
- 9.8 lakh shareholders? That’s more than people who showed up for that last IPO rally.
13. EduInvesting Verdict™
Ujjivan SFB is a classic case of small town hustle meeting stock market scrutiny. The growth engine is humming, but NPAs are whispering, margins are melting, and the “other income” cushion is way too comfy.
A budget flight with legroom… until turbulence hits.
Metadata:
Written by EduInvesting Team | July 25, 2025
Tags: Ujjivan SFB, Small Finance Bank, Banking Stocks, EduInvesting Premium
