Ujjivan Small Finance Bank Ltd: ₹6,396 Cr Revenue, ₹37,630 Cr Deposits – From Serving the “Economically Active Poor” to Dreaming of Universal Banking

1. At a Glance

Once upon a time, Ujjivan was a humble NBFC lending to the “economically active poor” (translation: people who actually pay back on time). Fast forward to FY25, it’s now a ₹8,449 Cr market cap listed bank with 95 lakh customers, 753 branches, 37,630 Cr deposits, and an application in RBI’s inbox for a Universal Bank license. In short, Ujjivan started with ₹500 loans for tea-stall uncles and now dreams of becoming HDFC’s neighbour in Nariman Point.

2. Introduction

India’s financial inclusion fairy tale has two main characters – the borrower who needs ₹10,000 to buy a buffalo and the lender who writes 300 pages of risk policy for that buffalo loan. Ujjivan Small Finance Bank (SFB) is one such lender that grew by riding the microfinance wave.

Born in 2005 as Ujjivan Financial Services (NBFC-MFI), it morphed into a Small Finance Bank in 2017. By FY25, it had ₹32,122 Cr loan book spread across group loans (41%), affordable housing (23%), individual loans (16%), MSME, FIG, agri and other odd jobs. Deposits at ₹37,630 Cr now outpace loans – a rare “ghar me paisa zyada, bahar diya kam” situation for a small bank.

The reverse merger with parent Ujjivan Financial Services in 2024 cleaned up corporate structure, and the appointment of Sanjeev Nautiyal as MD added some ex-SBI gravitas. CRAR is a fat 23%, GNPA slashed to 2.2% (vs 7.1% in FY22), and net NPA a diet-friendly 0.5%. Clearly, the bank spent its pandemic years in detox.

Now, Ujjivan wants a Universal Banking license. Imagine a bank that once gave Rs 20,000 group loans in Bihar now planning to issue forex cards in Dubai. Classic desi ambition.

3. Business Model (WTF Do They Even Do?)

Think of Ujjivan as a kirana banker that graduated to Big Bazaar.

1. Retail Banking (85% of revenue):
   • Group loans (women sitting in circles, paying weekly instalments).
   • Affordable housing loans (your 2BHK in outskirts).
   • MSME, vehicle, and gold loans (because collateral = god).
2. Treasury (12%):
   Every small bank’s secret side-hustle: park money in SLR bonds, earn interest, pretend it’s strategic.
3. Wholesale Banking (3%):
   Just enough to tell RBI, “Yes sir, we also serve corporates.”

Digital banking is its new avatar – 125+ features, app in 11 languages, and even UPI Lite for chai transactions. Because nothing says financial inclusion like scanning QR code for ₹5 cutting chai.

4. Financials Overview

• YoY profit collapsed (base effect + stressed book sale).
• QoQ showing recovery.
• EPS annualised ~₹2.1 → PE ~20x if this persists, but if normalised ~₹3 → PE ~15x.

Auditor’s sarcasm: One bad quarter doesn’t make a scam, but