ESAF closes FY22 with Rs54.73 cr net profit

By CL Jose

IPO likely to be launched before Oct 20

KOCHI/May 11-2022: ESAF Small Finance Bank closed the financial year 2021-22 (FY22) with a much-needed net profit of Rs54.73 crore after lapping up a cumulative loss of more than Rs50 crore towards the end of third quarter (Q3) ending December 31, 2021.

The Rs105.60 crore net profit earned by the bank for the fourth quarter (Q4) helped the bank save its face by leaving its 9-month cumulative loss behind, and close the year with a net profit.

A positive ending was inevitable for the bank as it is girding up its loins for its much-awaited initial public offer (IPO) that has to take place before October 20, 2022 when it completes one year after obtaining the Sebi clearance for the public issue.

The bank had filed the Draft Red Herring Prospectus (DRHP) for initial public offer (IPO) with Securities and Exchange Board of India (SEBI) on July 24, and obtained final observations vide their letter dated October 20, 2021.

The total income for the bank for Q4 was Rs646.43 crore compared with Rs565.57 crore for the previous quarter and a much lesser Rs432.85 crore for the same period last year.

Despite a relatively low provisioning at Rs16.81 for the fourth quarter, the full year provisioning was a substantial Rs418 crore compared with Rs275.61 crore for the previous year.

Even as advances surged by 42.48 per cent, from Rs8167.59 crore to Rs11,637 crore during the year, the capital adequacy ratio (CAR) saw a considerable decline from24.23 per cent to 18.64 per cent as of March 31, 2022.

NPA witnessed a marginal worsening during the year as the gross NPA inched up from 6.7 per cent to 7.83 per cent and net NPA from 3.88 per cent to 3.92 per cent.

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