New Research Reports

AU SFB continues to grow its credit portfolio at a healthy pace, defying industry trend and the declining MFI/Card book. However, higher CoF and interest reversal on MFI/Card NPAs has led to continued margin correction (10bps QoQ).

We maintain our BUY recommendation on the stock.

Advances growth driven by secured loans; deposit growth was strong compared to system levels

We recommend a BUY on the stock with a target price of Rs 49/share, implying an upside of 11% from the CMP.

FY25 has been weak for the bank marked by elevated stress in unsecured retail loans resulting in a sharp increase in credit costs, higher interest rates and tight liquidity. Q4 earnings missed estimates led by accelerated provisioning on account of the stress in unsecured loans, yet PCR improved.

AU Small Finance Bank (AUBANK) posted a 4QFY25 PAT of INR5.04b (7% beat; -5% QoQ), amid better other income partly offset by higher provisions. NII grew 3.5% QoQ to INR20.9b (in line), while NIM contracted 6bp QoQ to 5.8%, primarily on account of a change in asset mix.

Black & White report

We initiate coverage on Fino Payments Bank (Fino) with BUY and TP of Rs300 (upside of 34%). Fino has emerged as a distinctive, asset-light, and profitable payment bank, capitalizing on India’s RURBAN digitization wave.

Rising share of diversified and secured portfolio with MFI mix likely to decline further; scaling up granular deposit franchise