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Ujjivan SFB targets 25% credit growth as secured loans drive expansion

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Ujjivan SFB targets 25% credit growth as secured loans drive expansion

Affordable housing finance is expected to grow around 35%, supported by a diversified portfolio and contained asset quality. In the micro-mortgage segment, the bank is moving away from loans below Rs 5 lakh towards the Rs 5-15 lakh category.

Advances grew 32% year on year, led by 47% growth in non-microfinance advances. Affordable housing finance is expected to grow 35%, with 117 branches planned in H2. NIM fell five basis points sequentially to 8.45%, with further pressure expected in H2. Net profit rose 200% year on year, while credit costs declined to 0.93% from 1.22% in Q1.

Ujjivan Small Finance Bank expects to deliver 25% credit growth in FY27, largely led by secured lending, as it seeks to diversify its portfolio amid pressure on net interest margins. The bank plans to increase the share of secured loans to at least 56% by the end of FY27, from around 52% in Q2, with affordable housing, micro, small and medium enterprises (MSMEs) and gold loans supporting expansion. The bank's advances grew 32% year on year and 6% sequentially in Q2FY27, led by strong momentum in non-microfinance lending, where advances rose 47% year on year. Deposits grew 29% year on year, while net interest income increased 35%. The bank is expected to maintain growth momentum while adopting a calibrated approach to microfinance lending, according to Axis Securities. Advt

Non-microfinance disbursements rose 58% year on year in Q2, while microfinance disbursements grew 10%. 4% in the previous quarter. The bank retained its FY27 microfinance portfolio growth guidance of 12-14%, prioritising collections and portfolio quality, particularly in geographies facing weather-related risks.


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