India’s Ujjivan Small Finance Bank gains; BOB Capital sees improved earnings

Ujjivan Small Finance Bank

14/07/2025 05:53

** Ujjivan Small Finance Bank UJJI.NS rises 2.7% to 48.8 rupees; marks highest intraday pct gain since June 10

** BOB Capital Markets initiates with "buy"; sets PT of 59 rupees, implying 24% upside to last close

** Highlights bank's shift to secured lending, with those loans rising to 43% of gross advances in FY25 from year-ago 30%

** Says bank moving to higher yielding individual loans within unsecured book; individual loans amounting to 28% of gross microfinance institution (MFI) loans as of March vs year-ago 23%

** Notes asset quality better than peers'; MFI stress expected to normalise from H2 FY26

** Forecasts "healthy" 19% loan CAGR over FY25–FY27, with RoA/RoE improving

** UJJI rated "buy" on avg; median PT is 55 rupees, per data compiled by LSEG

** Stock gains 44% YTD

 (Reporting by Rudra Pratap Singh in Bengaluru)

 ((rudrapratap.singh@thomsonreuters.com))