NBFC Ujjivan Services reports 54 percent jump in December quarter

Non-banking financial company Ujjivan Financial Services Wednesday reported a 54 percent jump in consolidated net at Rs 45.2 crore for the quarter to December, helped by higher loan growth and margins. Ujjivan Financial Services is the holding company and promoter of Ujjivan Small Finance Bank.

"The quarter was very good for us. Net profit rose to Rs 45.2 crore on account of a 35 percent growth in disbursement at Rs 2,885 crore," managing director and chief executive Ittira Davis said. Loan book stood at Rs 9,249 crore, clipping at 31.8 percent helping net interest margin to settle at 11.8 percent in the reporting quarter.

"Stable cost of funds and interest rate hike for group loans has helped us maintain margins at 11.8 percent," Davis explained, adding this has resulted in average cost of funds at 8.5 percent in the quarter. Another reason for the good set of numbers is an increased in the secured loan portfolio which rose to 10.2 percent of the total portfolio from 3.9 percent a year ago, Davis said.

Asset quality has massively improved during the quarter with gross NPAs coming down to a low 1.4 percent from a high 4.2 percent a year ago, and net NPAs coming down to a trickle at 0.3 percent from 1 percent. It wrote off Rs 29 crore of loans in the quarter. Ujjivan Small Finance Bank serves over 43.7 lakh customers through 522 branches and 14,305 employees spread across 223 districts in 24 states. The company shares slipped 2.2 percent at Rs 84.40 on the BSE on a day when the benchmark Sensex tanked 0.92 percent in a late selling.