ESAF Small Finance Bank rises after newly-listed firm reports strong Q2 results
ESAF Small Finance Bank (ESAFSFB) shares rose after the lender staged a strong financial performance for the September quarter.
ESAF Small Finance Bank (ESAFSFB) shares were in demand on Monday after the newly listed small finance lender reported a largely strong set of quarterly numbers. The stock of Kerala-based ESAF Small Finance Bank—which entered the listed universe this month—gained by as much as Rs 2.7, or four per cent, to Rs 71.6 apiece on BSE, coming within Rs 3 of an all-time high hit on its first day on Dalal Street.
On Saturday, the lender reported a 2.4 times year-on-year jump in net profit to Rs 140 crore for the July-September period. Its net interest income (NII)—or the difference between interest earned and interest paid—increased 36.6 per cent to Rs 943 crore, according to a regulatory filing.
The lender's net interest margin (NIM)—a key measure of profitability—stood at 11.98 per cent for the second quarter of the current financial year.
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Its gross non-performing assets (GNPAs) stood at 2.64 per cent of its total loans for the quarter ended September 2023, as against 1.65 per cent for the corresponding period a year ago. ESAF's net non-performing assets (NNPAs) came in at 1.19 per cent, as against 4.34 per cent a year ago, according to a statement.
ESAF Small Finance Bank said its operating profit increased 37.4 per cent on a year-on-year basis to Rs 289.7 crore for the quarter ended September 2023.
“I am pleased to see that our bank has achieved another quarter of robust financial performance. Our steadfast focus on rural and semi-urban locations along with the sustainable model we pursue has played a pivotal role in driving this success. In line with our strategic vision, our wholehearted dedication to expanding our presence in these underserved areas, contributing not only to our bottom line but also to the economic development of these communities," said K Paul Thomas, MD and CEO, ESAF Small Finance Bank.
As of September 30, 2023, ESAF Small Finance Bank’s distribution network stood at 700 branches and 579 ATMs across 236 districts in 21 states and two Union Territories in the country.
ESAF Small Finance Bank shares: Debut and beyond
As of Friday, the stock commanded a premium of 14.7 per cent over the upper end of the issue price range of the company's IPO. On November 10, ESAF Small Finance Bank (ESAFSFB) shares entered the listed universe at a premium of about 18-20 per cent over the issue price.
Its IPO was subscribed more than 73 times with strong participation from all categories of investors.