AU Small Finance Bank Reports Record NII Amid Mixed Financial Metrics and Valuation Adjustments

AU Small Finance Bank has recently undergone an evaluation adjustment, reflecting notable shifts in its financial metrics and market position. The bank reported a strong financial performance for the quarter ending March 2025, highlighted by a record Net Interest Income (NII) of Rs 2,093.92 crore and total interest earned reaching Rs 4,270.60 crore. Additionally, the Profit After Tax (PAT) showed significant growth, reaching Rs 503.70 crore, which represents a year-on-year increase of 35.9%.
However, the evaluation adjustment also considers some challenges, including a recorded loss in Profit Before Tax (PBT) of Rs -103.52 crore, indicating pressures on non-operating income. The bank's valuation metrics have shifted, with the Price to Earnings (PE) ratio now at 23.42 and a Price to Book Value of 2.89, suggesting a more expensive valuation relative to its historical averages.

On the technical front, the stock's trend has transitioned from sideways to a mildly bullish stance, supported by positive indicators such as Bollinger Bands and On-Balance Volume (OBV). The bank's strong capital adequacy ratio of 21.50% further underscores its robust financial health.

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