- Ujjivan bank showed strong AUM, PBT and NII growth YoY in 3QFY20.

- As the bank was cautious in Micro Finance Institution (MFI) business, disbursement growth saw sequential decline but good traction was witnessed in affordable housing segment.

- Operating costs continue to rise on back of branch scale up & IPO expenses.

- Asset quality remained stable however higher credit cost due to write off led to sequential decline in PBT.

- Scale up of liabilities; high cost structure and unseasoned non-MFI book also remain the key areas to watch out for.

- Valuations of 2.3x on FY22e book does build in some degree of success in non-MFI businesses. Business might take some time to take off.

Disclaimer: The above report is compiled from information available on public platforms. inChat team advises users to check with certified experts before taking any investment decisions.

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