Ujjivan Financial posts Q1 net profit of Rs 45 crore
Ujjivan Financial Services registered a consolidated net profit of Rs 45 crore in the first quarter ended June, mainly on account of healthy increase in revenues from operations.
It had posted a net loss of Rs 74.90 crore in the corresponding April-June period of 2017-18. However, compared sequentially, the profit was lower than Rs 64.90 crore posted in the March quarter of the previous financial year 2017-18.
Total income during April-June 2018-19 increased by 28.4 percent to Rs 459.60 crore as against Rs 358.10 crore in the same period of 2017-18, Ujjivan said in a regulatory filing.
Net interest income grew by 61 percent during the June quarter grew to Rs 222.40 crore. While net interest margin, a key gauge of profitability, improved to 11.6 percent in June 2018 from 9.2 percent a year ago.
Company's asset quality improved as the gross non-performing assets (NPAs) as a percentage of gross lending fell to 2.7 percent as on June 30, 2018, from 6.2 percent as of June 2017.
Net NPAs or bad loans also fell to 0.3 percent from 2.3 percent.
There was a fall in provisions and contingencies by 68.2 percent to Rs 37.90 crore in June quarter from Rs 119.20 crore a year ago, helping the company to register gains.
Ujjivan Financial Service began its fully owned small finance banking services through the launch of Ujjivan Small Finance Bank in early 2017.
On the banking outlets rollout plan, Ujjivan Financial said it converted 87 of its asset centers into banking outlets in the June quarter of 2018-19 and added one unbanked rural center (URC).
For the full year, a total of 475 banking outlets are being planned with 219 assets centers to be converted into bank branches, an opening of 7 new outlets and 62 new URCs in West Bengal, Bihar, Odisha, Gujarat, Karnataka and Tamil Nadu.
Remaining 49 asset centers will be converted in 2019-20, it said.
Samit Ghosh, MD & CEO, Ujjivan Small Finance Bank, said: "The transition to a bank from a microfinance institution has stabilized and last year we completed the clean-up of our portfolio post demonetization. We are now focused on scaling up different business verticals of the bank and multiple distribution channels. This
quarter we also witnessed a good momentum on the retail deposits as we have reduced our reliance on CDs."
Cost of funds has reduced and with continued efforts, the gross NPAs have reduced significantly, said Ittira Davis, MD & CEO, Ujjivan Financial Services.
Calculated on an average cost of borrowings and deposits, company's cost of funds fell to 8.6 percent during the quarter from 9.8 percent in the year-ago same period.
However, it was up at 8 percent from 7.5 percent year ago when calculated on the basis of the marginal cost of interest of borrowings.
The stock of Ujjivan Financial Services closed 3.30 percent up at Rs 399.45 on BSE.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)