Equitas Small Finance Bank Reports Mixed Results for Q1 FY25

Equitas Small Finance Bank, a midcap private bank, recently announced its financial results for the quarter ending June 2024. The bank has received a ‘Sell’ call from MarketsMOJO, indicating a negative performance for the quarter.

According to the financials, Equitas Small Finance Bank has seen a decline in its overall score from 4 to -8 in the last three months. However, there are some positive aspects to the bank’s performance. The net interest income for the quarter was the highest at Rs 801.48 crore and has been growing consistently for the past five quarters. This indicates that the bank’s core business is performing well.

The interest earned for the quarter was also the highest at Rs 1,500.95 crore and has been growing each quarter for the past five quarters. This shows a positive trend in the bank’s sales. Additionally, the net non-performing assets (NPA) for the quarter were the lowest at 0.83%, indicating a decrease in the proportion of stressed loans given by the bank.

However, there are some areas of concern for Equitas Small Finance Bank. The profit before tax (PBT) less other income for the quarter was at Rs -172.94 crore, which is a significant decline of -361.6% compared to the average PBT of the previous four quarters. The profit after tax (PAT) for the quarter was also at a low of Rs 25.76 crore, showing a decline of -87.1% compared to the average PAT of the previous four quarters.

The operating profit margin for the quarter was the lowest at 8.77% and has been falling each quarter for the past five quarters. This indicates a deterioration in the bank’s efficiency. The operating profit (PBDIT) for the quarter was also at its lowest at Rs 131.70 crore, showing a negative trend in the near term.

Furthermore, the non-operating income for the quarter was 583.61% of the PBT, indicating a high income from non-business activities. This may not be a sustainable business model for the bank. The earnings per share (EPS) for the quarter were also at its lowest at Rs 0.23, showing a decline in profitability and lower earnings for shareholders.

In conclusion, Equitas Small Finance Bank has seen a negative financial performance for the quarter ending June 2024. While there are some positive aspects to the bank’s performance, there are also areas of concern that need to be addressed in order to improve its overall performance.