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Some Small Finance Bank Stocks Register 20% Growth

Submitted by admin on May 2nd, 2024

Jana Small Finance Bank’s shares registered a 20 percent growth to Rs 599 on the BSE. Tuesday witnessed such a decent surge amid significant improvement in asset quality. Gross Non-Performing Assets or GNPA registered a 2 percent improvement at the end of the 1^st quarter of 2024. GNPA was 3.6 percent at the same time one year ago.

Jana SFB stock has been trading at its peak since it made its debut in the stock market on February 14, 2024. At present, it is standing 43 percent higher than its original or issue price of Rs 414 per share. The stock jumped back 62 percent from Rs 365, which is its low, on the listing day.

At the counter, the average trading volume soared more than five times. A combined equity shares worth 6.42 million changed hands on the BSE and NSE till 11:40 am,

Meanwhile, Jana SFB registered the highest-ever profit at Rs 670 crore after tax (PAT), up 162 percent YoY (year-on-year) for the financial year. Net interest jumped 28.1 percent at Rs 2, 127 crore YoY and net interest margin reported 0.8 percent improvement in FY24 as against 7.8 percent in Financial Year 2023.

Loan asset under management (AUM) spiked 24.9 percent YoY at Rs 24, 746 crore. Total deposits jumped 38 percent YoY to Rs 22, 571 crore.

The management guided 0.2 percent growth in AUM and deposits. PAT growth registered 0.3-0.4 percent and ROE growth soared from 19-21 percent.

Primarily, Jana SFB offers deposit products (such as demand, term deposits, and savings) and lending services, including both secured and unsecured loans. Primary secured loans include:

• Business loans
• Affordable business loans
• MSME loans
• Microloans against property (Micro LAP)
• Loans against fixed deposits
• Term loans to NBFC
• Two wheeler loans
• Gold loans

The primary unsecured loans include

• Individual loans
• Micro business loans
• Group loans (A group of women receives group loans according to the Joint Liability Group model)
• Agricultural and allied loans

SFBs provide basic banking services including payment, receiving deposits, and lending to underserved and unserved sections of the Indian economy, including marginal farmers, small and micro industries, small businesses, and unorganized sectors,

SFBs focus on serving the sections at the bottom of the pyramidal economic structure to drive financial growth. Industrial growth is illustrated through the exponential growth in deposits and advances as well as supported and strengthened by the exponential rural growth, new product launches, and associated cross-selling opportunities, driving the SFB’s market share manifolds in the future, as per Fitch.