Ujjivan Small Finance Bank Q1 FY27: PAT up 207%

Key takeaway from the June 2026 quarter

Ujjivan Small Finance Bank reported a sharp year-on-year rise in profitability for the quarter ended June 30, 2026 (Q1 FY27), supported by higher interest income, record net interest income and lower provisions. Profit after tax (PAT) came in at ₹316.54 crore (₹31,654 lakh), up 206.66% year-on-year from ₹103.22 crore (₹10,322 lakh). On a sequential basis, PAT rose 12.26% from ₹281.97 crore (₹28,197 lakh) in Q4 FY26.

The bank also reported its highest-ever quarterly net interest income (NII) at ₹1,186 crore, a 38.6% year-on-year increase. Net interest margin (NIM) stood at 8.5% during the quarter, indicating strong yields in the core lending book. The results were announced on Thursday, July 23.

Profitability: PAT, PPOP and return ratios strengthened

Along with the PAT increase, Ujjivan reported its highest-ever quarterly pre-provision operating profit (PPOP) of ₹548 crore, up 52.0% year-on-year. In the financial statement summary, operating profit (before provisions and contingencies) was ₹548.06 crore (₹54,806 lakh), up 52.04% year-on-year and 6.50% quarter-on-quarter.

Return ratios also moved higher. Return on assets (RoA) rose to 2.2%, up 131 basis points year-on-year. Return on equity (RoE) improved to 18.2%, up 1,145 basis points over the year-ago quarter. The bank’s net worth as of Q1 FY27 was reported at ₹7,144.26 crore (₹7,14,426 lakh).

Income line: interest earned rose; other income mixed

Total income for Q1 FY27 stood at ₹2,280.93 crore (₹2,28,093 lakh), representing 22.12% year-on-year growth and 4.39% sequential growth. Interest earned increased to ₹2,024.92 crore (₹2,02,492 lakh), up 25.08% year-on-year and 7.80% quarter-on-quarter.

Other income for the quarter was ₹256.01 crore (₹25,601 lakh). It rose 2.82% year-on-year but fell 16.53% sequentially from ₹306.70 crore (₹30,670 lakh) in Q4 FY26. The quarter therefore showed a clear tilt toward core interest-led growth.

Costs and provisions: credit buffer eased in Q1

Provisions (other than tax) and contingencies for Q1 FY27 were ₹127.32 crore (₹12,732 lakh). This was down 43.40% year-on-year from ₹224.94 crore (₹22,494 lakh) and down 11.49% sequentially from ₹143.85 crore (₹14,385 lakh).

The bank also disclosed a floating provision of ₹180.67 crore (₹18,067 lakh) as of June 30, 2026. Separately, commentary in the provided material noted credit cost at 0.9% for the quarter and a revision in FY27 credit cost guidance to 0.9% to 1.0% of average total assets.

Operating efficiency: cost-to-income improved

Ujjivan’s cost-to-income ratio declined to 62.0% in Q1 FY27 from 67.0% a year ago, an improvement of 497 basis points. This operating leverage was highlighted alongside the record NII and PPOP.

The same set of notes also stated that, due to delayed commencement of certain expenses and continued efficiency gains, FY27 operating expenses are expected at around 6.4% of average assets, lower than previously anticipated. The bank also cited an upgraded FY27 RoA guidance of 1.8% to 2.0%.

Balance sheet growth: deposits and advances expanded

The bank reported strong business momentum in the June quarter. Total deposits were reported at ₹48,307 crore as of June 30, 2026, up 25.1% year-on-year from ₹38,619 crore and up 5.8% sequentially from ₹45,668 crore (March 2026). Another figure in the material cited total deposits at ₹48,129 crore for the quarter, indicating slightly different reporting cuts across disclosures.

On the lending side, the gross loan book stood at ₹42,903 crore, a 28.9% year-on-year increase from ₹33,287 crore and a 5.5% quarter-on-quarter increase from ₹40,655 crore. The credit-deposit ratio was reported at 88.8% for Q1 FY27.

Secured lending share crosses 50% of advances

The bank’s secured loan portfolio continued to rise, with one disclosure citing secured loans at ₹21,638 crore and another citing the total secured book at ₹21,555 crore. Both data points indicated that secured loans now account for just over half of the overall loan book (around 50.2% to 50.4%), highlighting the bank’s shift toward a more secured mix.

Disbursements during the quarter stood at ₹9,252 crore, up 41.5% year-on-year. The same disclosure also noted a 5.7% quarter-on-quarter decline in disbursements.

Asset quality: GNPA and NNPA improved sequentially

Asset quality improved on both a sequential and year-on-year basis. Gross non-performing assets (GNPA) declined to about 2.16% to 2.17% as of June 2026, compared with 2.27% to 2.26% in March 2026 and 2.52% in the year-ago period.

Net NPA (NNPA) stood at 0.34% in Q1 FY27, improving from 0.43% in Q4 FY26 and 0.70% in Q1 FY26. The bank also reported write-offs of ₹68 crore for the quarter. Collection efficiency in the core microbanking bucket was reported at 99.68%.

Market reaction: stock recovered from early losses

On the day of the result (July 23), Ujjivan Small Finance Bank’s share price, which had fallen nearly 4% earlier in the session, recovered and moved into positive territory after the earnings announcement. The stock rose as much as 1.63% to ₹66.10 on the NSE during the session, based on the data provided.

Corporate updates: AGM schedule and ESOP allotment

The bank also intimated the publication of a newspaper advertisement for its 10th Annual General Meeting (AGM), scheduled for July 24, 2026 via video conferencing. Remote e-voting was available from 9:00 AM on July 21, 2026, until 5:00 PM on July 23, 2026.

During Q1 FY27, the bank allotted 25,41,377 equity shares under the ESOP 2019 plan, pursuant to employee stock option exercises.

Snapshot table: Q1 FY27 performance and indicators

Why this quarter matters for investors tracking small finance banks

Ujjivan’s Q1 FY27 numbers combine three elements that investors in small finance banks typically watch closely: sustained loan growth, strengthening liability franchise and improving credit metrics. Deposit growth of 25.1% year-on-year and a loan book up 28.9% year-on-year indicate continued scale-up, while the shift to a secured mix above 50% suggests a structural change in the risk profile of the book.

At the same time, provisions fell both year-on-year and quarter-on-quarter, and headline asset quality improved with GNPA around 2.16% to 2.17% and NNPA at 0.34%. The record NII and higher RoA and RoE show that profitability expanded alongside balance sheet growth, rather than being driven by one-off factors in the provided data.

Conclusion

Ujjivan Small Finance Bank’s Q1 FY27 results showed a sharp year-on-year rise in profit, record NII, lower provisions and improved asset quality, alongside strong growth in deposits and advances. Near-term attention remains on the bank’s stated FY27 guidance for credit cost (0.9% to 1.0%) and RoA (1.8% to 2.0%), as well as disclosed corporate events such as the July 24, 2026 AGM.