Company Update : AU Small Finance Bank Ltd By Motilal Oswal Financial Services Ltd
Business growth strong; CD ratio declines
AUBANK released its business update for 4QFY25. Here are the key highlights:
* AUBANK has reported a strong 7.7% QoQ (+25.8% YoY) growth in gross advances to ~INR1.08t. Including the securitized/assigned + IBPC loan portfolio, the total loan portfolio grew 6.2% QoQ (19.9% YoY).
* The bank securitized its asset portfolio of INR69.3b in 4QFY25 and INR79.3b in 3QFY25, resulting in a GLP growth of 6.2% QoQ in 4QFY25.
* Deposit growth too was healthy at 10.7% QoQ to reach INR1.24t (clocked a strong growth of 27.2% YoY).
* CASA deposits grew healthy by 5.4% QoQ (+15.2% YoY) to INR362b. However, relatively slower growth in CASA vs. deposits resulted in a dip in the CASA ratio to 29.2% vs. 30.6% in 3QFY25 and 32.2% as of 1st Apr’24.
* Overall, business growth was strong, with advances growth being largely inline with our expectations. In contrast, deposit growth was robust (reported growth of 10.7% QoQ vs. our estimate of +6.1% QoQ). Faster deposit growth led to a decline in the CD ratio to ~86.2% (down 2.5% QoQ, on a calculated basis).
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