Utkarsh Small Finance Bank Ltd. share price target

Utkarsh SFB (Utkarsh) is embarking on a journey to deliver 25% credit growth with 50% share of secured products and RoE of ~15% over the next 2–3 years driven by NIM expansion to 8.5% and credit cost at ~2%.

Utkarsh SFB’s (Utkarsh) Q1FY25 core operating performance continued to be robust as reflected in 10% QoQ PPoP growth and RoE sustaining at >18% despite challenges due to heatwaves and election.

Utkarsh SFB’s (Utkarsh) Q4FY24 financial performance is testimony to management’s ability to deliver as per guidance with exit RoA of ~3% and RoE at 22% despite muted H1FY24 due to sector level headwinds on both growth and asset quality.

Utkarsh SFB (Utkarsh) kick-started its lending journey in the states of UP and Bihar, and since inception (in FY10), it has remained committed in establishing a strong niche in these states. Considering the under penetration in its core
markets (Bihar’s top 5 districts covered 46% of overall credit, of which Patna alone contributes 29% share), with Utkarsh having a strong market share of 56% within SFBs (overall market share at 2%), the SFB is best placed to complement the Bihar growth story.

IPO NOTE