Utkarsh Small Finance Bank - Best Placed To Play Uttar Pradesh’s Structural Growth Story: ICICI Securities

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..ICICI Securities Report.Utkarsh Small Finance Bank Ltd. has kick-started its lending journey in the states of Uttar Pradesh and Bihar, and since inception (in FY10), it has developed strong demographic knowledge and built deep distribution network in these two states. We see Utkarsh’s deep presence in under-penetrated states (of total 75 districts only seven districts have more than 20% credit penetration in UP), enhanced product offering, proven track record of managing asset quality better than peers (write-offs during Covid at 12% versus 15-20% for micro finance players) and its rapidly evolving liability franchise (steady decline in cost of funds) ensuring sustainability of more than 18% return on equity and more than 25% growth over FY24-26E. While its credit market share in Uttar Pradesh stood at sub 42 basis points, within small finance bank space, its market share stands at 40% as on December 2023. Maintain Buy with an unchanged target price of Rs 70, valuing the stock at two times FY25E book value per share..Click on the attachment to read the full report:.Paytm - Navigating Through The Storm: Motilal Oswal.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Utkarsh Small Finance Bank - Best Placed To Play Uttar Pradesh’s Structural Growth Story: ICICI Securities

Deep presence, strong brand name in under-penetrated states augur well for growth sustainability

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