AU Small Finance Bank Reports Strong Earnings Amid Rising NPA Concerns

AU Small Finance Bank has recently undergone a financial trend adjustment, reflecting a shift in its performance metrics. The bank reported a robust financial performance for the quarter ending June 2025, with interest earned reaching an impressive Rs 4,378.44 crore and a record profit after tax (PAT) of Rs 580.86 crore. Additionally, the earnings per share (EPS) stood at Rs 7.79, indicating strong profitability in certain areas.
However, challenges persist for the bank. The profit before tax (PBT) excluding other income has significantly declined to Rs -31.71 crore, marking a notable drop. Furthermore, the gross non-performing assets (NPA) have risen to 2.47%, raising concerns about asset quality. The non-operating income has also become a substantial portion of the profit before tax, accounting for 104.07%.

In terms of market performance, AU Small Finance Bank has shown resilience compared to the Sensex over various time frames. Year-to-date, the bank's stock has returned 33.19%, significantly outperforming the Sensex's 2.44%. Over the past year, the stock has delivered an 18.74% return, while the Sensex has only seen a 1.47% increase. This performance highlights the bank's ability to navigate market fluctuations effectively, despite facing some operational hurdles.