Ujjivan Financial Services slips after dismal Q1 results

Ujjivan Financial Services fell 1.88% to Rs 303.15 at 11:21 IST on BSE after reporting consolidated net loss of Rs 74.94 crore in Q1 June 2017 compared with net profit of Rs 71.37 crore in Q1 June 2016.

The result was announced after market hours yesterday, 3 August 2017.

Meanwhile, the S&P BSE Sensex was down 79.71 points, or 0.25% to 32,158.17.

On the BSE, 6.94 lakh shares were traded in the counter so far, compared with average daily volumes of 2.48 lakh shares in the past one quarter. The stock had hit a high of Rs 306.30 and a low of Rs 285 so far during the day. The stock hit a 52-week high of Rs 484 on 4 October 2016. The stock hit a 52-week low of Rs 285 on 26 December 2016.

The stock had underperformed the market over the past one month till 3 August 2017, falling 5.20% compared with 3.18% rise in the Sensex. The scrip had also underperformed the market in past one quarter, falling 10.85% as against Sensex's 7.97% rise. The scrip had also underperformed the market in past one year, falling 31.17% as against Sensex's 16.32% rise.

The mid-cap company has equity capital of Rs 119.64 crore. Face value per share is Rs 10.

On a consolidated basis, Ujjivan Financial Services' total income rose 8.90% to Rs 358.64 crore in Q1 June 2016.

Samit Ghosh, managing director & chief executive officer, Ujjivan Small Finance Bank said the bank has taken significant provision in Q1 June 2017 based on the collection trends.

Commenting on the performance of the company, Sudha Suresh, managing director & chief executive officer Ujjivan Financial Services said the company's cost to income in absolute amount is in line with the expectation, however the ratio in percentage terms is higher due to the low base impact of flat loan book and reversal of interest income due to non-performing asset (NPA). The company expects cost to income ratio to consistently come down during the year. As the company awaits the scheduled bank status, it is confident to raise deposits enabling its funding cost to come down by around 150 bps. The company's CAR is positioned comfortably at 19.83%. The company expects this ratio to improve further with the run-down of the grandfathered bank loans. It expects a repayment of around 65-70% of these loans during this financial year.

Ujjivan Financial Services is the promoter and non-operative holding company of its 100% subsidiary, Ujjivan Small Finance Bank, which has started the banking operations from February 2017. Ujjivan Small Finance Bank serves over 36.25 lakh active customers through 457 branches and 10,653 employees spread across 209 districts and 24 states in India. Ujjivan's Gross Loan Book stand at Rs 6459.27 crore. Ujjivan SFB currently has over 52 liability taking branches with deposit base of Rs 403.7 crore.

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