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Ujjivan Financial Services Expects Loan Book To Grow 40% In 2019-20

Ujjivan Financial Services also plans to bring down its cost to income ratio.

(Photographer: Adeel Halim/Bloomberg)
(Photographer: Adeel Halim/Bloomberg)

Ujjivan Financial Services Ltd. expects its loan book to grow at 35-40 percent in 2019-20 as it plans to stabilise its cost-to-income ratio, according to its managing director and chief executive officer Ittira Davis.

“We are planning to bring the cost to income ratio down to 70-72 percent in the current financial year which will help our bottom line,” Davis told BloombergQuint. The ratio is a measure of profitability—the lower it is, the more profitable is a lender.

Also, strong loan growth was offset by its branch expansion costs in the financial year 2018-19, said Davis. The Bengaluru-based company operationalised 287 banking outlets in the financial year, according to its press statement released along with the earnings. Its total number of branches stood at 524 as on March 31, including 474 banking outlets.

Key Highlights:(YoY)

  • Net interest income up 17.8 percent to Rs 319.7 crore.
  • Net profit down 2.2 percent to Rs 63.7 crore.
  • Disbursement up 68 percent to Rs 3,728 crore.
  • Gross bad loans stood at 0.9 percent versus 1.4 percent (QoQ)
  • Net bad loans unchanged at 0.3 percent (QoQ)

On Friday, Ujjivan shares rose 6.43 percent to Rs 362.40 apiece on the BSE while the benchmark Sensex fell 0.30 percent to 39,714.20 points.

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