Company Overview

ESAF Small Finance Bank Limited (Scrip Code: BSE 544020, NSE Symbol: ESAFSFB) submitted an investor presentation for the quarter ended June 30, 2026 (Q1 FY2027) pursuant to Regulation 30 of SEBI Listing Regulations. The document was dated July 31, 2026 and signed by Ranjith Raj P, Company Secretary and Compliance Officer.

Financial Performance Highlights

Key Metrics (Q1 FY27 vs Q1 FY26)

  • Gross Advances: ₹23,216 crore (27% YoY growth from ₹18,224 crore)
  • Deposits: ₹26,924 crore (19% YoY growth from ₹22,698 crore)
  • CASA: ₹6,297 crore (12% YoY growth from ₹5,628 crore); CASA ratio at 23.4%
  • Yield on Advances: 17.2% (vs 15.5% in Q1 FY26)
  • Cost of Deposits: 7.0% (vs 7.3% in Q1 FY26)
  • Net Interest Margin: 7.9% (vs 6.0% in Q1 FY26)
  • GNPA: ₹1,253 crore (vs ₹1,364 crore in Q1 FY26)
  • NNPA: ₹184 crore (vs ₹661 crore in Q1 FY26)
  • PCR: 85.5% (vs 73.2% in Q1 FY26); excluding additional provision of ₹64.7 crore during quarter
  • RoA/RoE: 1.0%/17.5% (vs (1.2)%/(17.6)% in Q1 FY26)
  • CRAR: 23.9% (vs 22.7% in Q1 FY26)
  • Cost to Income: 58.1% (vs 78.2% in Q1 FY26)

Profit & Loss Statement (Q1 FY27)

  • Interest Income: ₹1,097.77 crore (10.3% QoQ growth, 32.5% YoY growth)
  • Interest Expense: ₹513.69 crore (7.6% QoQ growth, 14.1% YoY growth)
  • Net Interest Income: ₹584.08 crore (12.8% QoQ growth, 54.6% YoY growth)
  • Other Income: ₹248.24 crore (23.3% QoQ growth, 27.2% YoY growth)
  • Breakdown: Loan Processing Fees (₹62.79 crore), Profit on sale of investments (₹7.64 crore), Profit on revaluation of investments (₹39.88 crore), Recovery on written off loan (₹0.12 crore), PSLC Income (₹69.77 crore), Account maintenance charge (₹7.30 crore), Third Party Product Income (₹13.89 crore), Other charges (₹46.86 crore)
  • Operating Expense: ₹483.34 crore (1.2% QoQ growth, 7.9% YoY growth)
  • Pre-Provision Operating Profit: ₹348.98 crore (44.6% QoQ growth, 179.4% YoY growth)
  • Provisions: ₹241.96 crore (13.0% QoQ growth, 3.3% YoY growth)
  • Profit Before Tax: ₹107.02 crore (295.1% QoQ growth from loss of ₹109.20 crore YoY)
  • Tax Provisions: ₹26.94 crore
  • Profit After Tax: ₹80.08 crore (240.7% QoQ growth from loss of ₹81.22 crore YoY)
  • Earnings Per Share (Diluted): ₹1.55 (vs loss of ₹1.57 in Q1 FY26)

Business Segments and Strategy

Advances Portfolio Composition

  • Secured Advances: 62% of portfolio (vs 59% in June-25)
  • MARG Portfolio (MSME, Agriculture, Retail, Gold Loans): Growth of 42% YoY and 8% QoQ
  • MSME Loans: ~₹21,00,000
  • Agri Loans: ~₹9,80,000
  • Retail Loans: ~₹8,00,000
  • Gold Loans: ~₹3,60,000
  • Emerging Household (EH) Segment: Growth of 185% YoY and 14% QoQ
  • Serves customers transitioning from microfinance with annual household income ₹3-15 lakh
  • Maximum loan limit up to ₹10 lakh
  • Unsecured lending restricted to individual loans only
  • Micro Finance: Declined 58% YoY and 26% QoQ, reflecting strategic shift toward EH segment
  • Corporate Loans: Degrowth of 36% YoY and 31% QoQ

Asset Quality Movement (₹ crore)

| Description | Q1FY26 | Q2FY26 | Q3FY26 | Q4FY26 | Q1FY27 |

| Opening Gross NPAs | 1,290.6 | 1,363.6 | 1,634.6 | 1,165.6 | 1,213.9 |

| Additions | 468.1 | 341.9 | 218.8 | 105.5 | 74.7 |

| Recovery | 13.2 | 14.4 | 25.1 | 12.0 | 10.0 |

| Upgradations | 19.4 | 28.2 | 34.8 | 45.3 | 25.3 |

| Sale to ARC | 362.4 | 28.3 | 627.9 | - | - |

| Closing Gross NPAs | 1,363.6 | 1,634.6 | 1,165.6 | 1,213.9 | 1,253.3 |

| Net NPAs | 660.9 | 696.4 | 547.9 | 382.4 | 184.1 |

| Recovery from Technical write offs and Sale to ARC | 27.6 | 30.3 | 70.1 | 60.5 | 31.2 |

PCR for Q3FY26 reduced due to transfer of NPA portfolio with higher provisions to ARC.

Balance Sheet Position

Key Balance Sheet Items (₹ crore)

| Item | Q1FY27 | Q4FY26 | Q3FY26 | Q1FY26 |

| Employee Stock Option Outstanding | 4.11 | 6.49 | 4.04 | 5.68 |

| Reserves and Surplus | 1,347.87 | 1,264.38 | 1,429.58 | 1,971.33 |

| Deposits | 26,924.47 | 25,850.16 | 23,276.44 | 19,867.80 |

| Borrowings | 2,112.67 | 2,752.74 | 1,405.73 | 3,222.53 |

| Other Liabilities and Provisions | 524.16 | 478.55 | 547.07 | 504.76 |

| Total Capital and Liabilities | 31,429.22 | 30,867.98 | 27,178.29 | 26,086.88 |

| Cash and Balances with RBI | 1,226.36 | 1,113.71 | 1,351.43 | 1,364.65 |

| Balances with Banks | 243.29 | 60.82 | 627.68 | 58.28 |

| Investments | 6,055.37 | 6,399.11 | 5,995.26 | 5,541.02 |

| Advances | 22,146.30 | 21,594.22 | 18,027.87 | 18,293.11 |

| Fixed Assets | 539.02 | 515.98 | 300.42 | 207.55 |

| Other Assets | 1,218.88 | 1,184.14 | 875.63 | 622.27 |

| Total Assets | 31,429.22 | 30,867.98 | 27,178.29 | 26,086.88 |

Strategic Initiatives and Business Model

Distribution Network

  • Banking Outlets: Full-fledged banking product & services
  • Institutional Business Correspondents (BCs): 33 BCs for sourcing and servicing micro loans, mortgage loans, vehicle loans, MSME loans, agricultural loans
  • Digital Banking: Mobile banking application, miss call banking, WhatsApp banking
  • ATMs and Debit Cards: Widespread ATM coverage with RuPay branded cards

Technology Initiatives

  • Digital platforms for internet banking, mobile banking, SMS alerts, bill payments
  • Digitalised central credit processing unit for Micro Loans
  • 24/7 multi-lingual call center facility
  • Cashless disbursements and digital collections
  • E-sign for micro loan disbursals

Growth Strategy Focus Areas

1. Increase Deposits: Target CASA, fixed deposits through customer service and competitive pricing; appoint dedicated relationship managers for HNI customers; focus on NRI remittances

2. Increase Advances: Strategic shift toward MARG portfolio (MSME, Agriculture, Retail, Gold); focus on Emerging Household segment; reduce microfinance exposure

3. Increase Fee Income: Expand third-party products; offer bank guarantees and letters of credit to MSMEs; commission income from Treasury/Forex Business

4. Leverage Technology: Enhance platforms for better data analytics and risk management

5. Focus on Recovery: Improve asset quality through data analysis and specialized workforce

6. Deeper Penetration: Open additional branches and ATMs; expand in existing states

Corporate Governance and Leadership

Board of Directors

  • Karthikeyan Manickam: Part time Chairman & Non-Executive Independent Director
  • Ms. Kolasseril Chandramohanan Ranjani: Non-Executive Independent Director
  • Kadambelil Paul Thomas: Managing Director and Chief Executive Officer
  • George Kalaparambil John: Executive Director
  • Ajay Sharma: Non-Executive Independent Director
  • George Ittan Maramkandathil: Non-Executive Director
  • Biju Varkkey: Non-Executive Independent Director
  • Vinod Vijayalekshmi Vasudevan: Non-Executive Independent Director

Senior Management Team

Includes experienced professionals across micro banking, finance, branch banking, retail assets, agri and MSME, technology, risk management, and compliance.

ESG and Sustainability Initiatives

  • Received ISO 26000:2010 certification for Social Responsibility
  • Triple bottom line approach focusing on People, Planet, Prosperity
  • Water 2 Earth Campaign for environmental conservation
  • CareEdge ESG rating of 51.8 (industry average 59)
  • Various awards for sustainability and social initiatives

Awards and Recognitions (2025-26)

  • Most Impactful Solar Energy Initiative of the Year – 2025
  • Tusker Awards 2025
  • BFSI: Small Finance Banks Award at BT India's Most Sustainable Companies Event
  • Best UPI-Based Digital Payment Solution - PayTech at ETBFSI FinNext Awards 2025
  • Best Bank in MSME Acceleration at 3rd ICC Emerging Asia Banking Conclave & Awards 2025
  • Digital Transformation Excellence Award for Core Platform Modernization

Investor Contact Information

For investor queries: Mr. Ranjith Raj P (investor.relations@esafbank.com) and Mr. Swapnil Moray (swapnil.vijaymoray@esafbank.com). Website: www.esafbank.com