Given the relatively smaller size and the large addressable underbanked/unbanked market that Esaf caters to, we do not see major growth challenges
PRO Only Highlights
- Quarterly performance largely backed by improved realisations
- Medium-term triggers China plus and protectionist measures for tyre industry
- Valuations not inexpensive; but improved medium-term outlook
- Quarterly performance largely backed by improved realisations
- Medium-term triggers China plus and protectionist measures for tyre industry
- Valuations not inexpensive; but improved medium-term outlook
Highlights Esaf SFB has underperformed post a decent listing Loan growth momentum continues to be strong Micro loans still dominate disbursement Interest margin declines a tad in Q3 Slippage on the higher side, asset quality worsens meaningfully Regional and product concentration makes the business model risky Diversification strategy can yield result in the long term Waiting for a more meaningful correction and/or significant improvement in asset quality ESAF Small Finance Bank (Esaf SFB, CMP: Rs 60.4 Market Cap: Rs 3,111 crore Rating: Equal-weight) saw a decent debut on the bourses...