Equitas SFB Q2 PAT soars to Rs 116 cr

Equitas Small Finance Bank reported a net profit of Rs 116.42 crore in Q2 FY23, steeply higher than Rs 41.19 crore recorded in Q2 FY22.

Total Income jumped 15.24% to Rs 1,147.39 crore in quarter ended 30 September 2022 from Rs 995.69 crore posted in the corresponding quarter previous year.

Profit before tax surged to Rs 152.22 crore in Q2 FY23 as compared to Rs 56.82 crore recorded in the same period a year ago.

Net Interest Income grew 26.03% to Rs 610 crore in Q2 FY23 as against Rs 484 crore in Q2 FY22. Net Interest Margin (NIM) during the quarter increased to 9% as against 8.14% in Q2 FY22.

Pre Provisioning Operating Profit (PPoP) stood at Rs 242 crore in Q2 FY23, rising 21.61% from Rs 199 crore in Q2 FY22.

On the asset quality front, the bank's gross non-performing assets (NPAs) was at Rs 870.26 crore as on 30 September 2022 as against Rs 856 crore as on 30 June 2022 and Rs 880.83 crore as on 30 September 2021.

GNPA was at 3.82% in Q2 FY23 as compared to 3.95% in Q1 FY23 and 4.64% in Q2 FY22.

NNPA stood at 1.93% in Q2 FY23 as compared to 2.07% in Q1 FY23 and 2.37% in Q2 FY22.

Provision coverage ratio improves to 50.49% in Q2 FY23 as compared with 48.46% reported in Q1 FY23.

Q2 FY23 disbursement was at Rs 3,845 crore, registering a growth of 22% year on year. Gross advances jumped 20% year on year to Rs 22,779 crore in quarter ended 30 September 2022.

CASA deposit grew 28% YoY to Rs 10,456 crore. CASA Ratio stood at 48% as of September 2022. Term Deposits grew 14% YoY to Rs 11,270 crore in Q2 FY23. Retail term deposits grew 13% YoY to Rs 7,665 crore. Retail term deposits contribute 68% of total term deposits.

As of 30 September 2022, total CRAR stood at 23.08%. Tier I was at 22.55% and Tier II at 0.53% as on 30 September 2022

The bank's Return on Assets (ROA) and Return on equity (ROE) stood at 1.60% and 10.57%, respectively in the quarter ended 30 September 2022.

Commenting on the quarterly performance, P N Vasudevan, managing director and CEO of Equitas Small Finance Bank said, Demand for credit continues to remain strong, especially in the informal sector. The 20% year on year growth in advances for the first half is expected to improve further in the seasonally active second half. Quality of portfolio remains a comfort with reducing credit cost. Deposit growth has been satisfactory and we have been able to retain the cost of funds with only marginal increase. Our CASA continues to remain in comfort zone and the digital initiatives of the Bank are beginning to yield significant benefits. Overall, the effect of Covid is receding and we expect to be back to our pre-covid levels of growth and profitability going forward.

Equitas Small Finance Bank offers products and services to meet the needs of individuals with limited access to formal financing channels, as well as affluent and mass affluent, Small & Medium Enterprises (SMEs) and corporates.

Shares of Equitas Small Finance Bank rose 0.50% to Rs 50.35 on the BSE.

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