ESAF Small Finance Bank Q2 PAT Doubles to Rs 160 Crore

The document is a regulatory filing containing the transcript of the Earnings Conference Call held on October 29, 2026, at 04:00 IST to discuss the Unaudited Standalone Financial Results for the quarter and half year ended September 30, 2026 (Q2 FY27).

The stated purpose of the event was to discuss the bank's financial performance, strategic transformation, and business outlook following the Q2 FY27 results announcement.

The transcript was made available on the bank's website at https://www.esaf.bank.in/investor-relation/?id=presentation-and-concall-transcript and was filed with the stock exchanges on November 04, 2026.

The call included a detailed presentation of financial results and a Q&A session with analysts. No explicit statement about unpublished price sensitive information (UPSI) was made in the provided transcript excerpt.

Performance Metrics (Q2 FY27):

Profit After Tax (PAT): Rs. 160 crores, doubling sequentially from Rs. 80 crores in Q1 FY27.
Net Interest Income (NII): Rs. 643 crores, up 73% Year-on-Year (YoY).
Pre-Provisioning Operating Profit (PPOP): Rs. 362 crores, up 289% YoY.
Net Interest Margin (NIM): 8.2%.
Return on Assets (ROA): 1.5% (annualized).
Return on Equity (ROE): 26.5% (annualized).
Cost-to-Income Ratio: 58% (vs. 82% in Q2 FY26).

Asset Quality & Provisions:

Gross NPA: Reduced significantly to 2.8% from 8.5% in Q2 FY26.
Net NPA: Declined to 0.3% from 3.8% in Q2 FY26.
Slippages: Reduced sharply to Rs. 87 crores from Rs. 342 crores YoY.
Technical Write-off: Rs. 626 crores for the quarter, described as likely the last from legacy NPA.
Credit Cost: Reduced to 2.6% (annualized) for the quarter; guided to be ~2% for full year FY27.

Business Growth (as of September 30, 2026):

Total Business: Rs. 52,400 crores (up 25% YoY). With IBPC, it stands at Rs. 53,450 crores.
Gross Advances: Rs. 23,934 crores (up 25% YoY).
Secured Portfolio: Rs. 15,377 crores (32% YoY growth), constituting 64% of advances.
Unsecured Portfolio: Rs. 8,557 crores (15% YoY growth).
MARG Portfolio (Mortgage, Agri, Retail, Gold): Rs. 13,938 crores (58% of portfolio, 38% YoY growth). Gold Loan book crossed Rs. 10,000 crores (Rs. 10,456 cr, GNPA at 0.1%).
Emerging Household (EH) Portfolio: Grew 134% YoY, contributing 32% of advances.
Total Deposits: Rs. 28,466 crores (up 24% YoY).
Retail Deposits: Rs. 25,475 crores (constituting 89% of total deposits).
CASA: Rs. 6,645 crores (CASA ratio at 23.3%).
Capital Adequacy (CRAR): 24.1%.

Strategic & Operational Updates:

ESAF 2.0 - StratoNeXt: The bank successfully implemented its major digital and IT transformation program, migrating to Oracle FLEXCUBE as its core banking system on October 26, 2026. This is expected to enhance operational efficiency, scalability, and customer experience.
Portfolio Diversification: Continued strategic shift towards secured lending (MARG) and Emerging Household loans, moving away from the traditional microfinance (Group Loans) book, which de-grew by 65% YoY.
Network: Added 10 new Banking Outlets; total footprint stands at 831 Banking Outlets, 722 ATMs, and 1060 Customer Service Centers across 24 States and 2 Union Territories.

Guidance & Outlook:

FY27 Guidance: ROA of ~2% for the full year; Credit cost of ~2%; Cost-to-income ratio around 60%.
FY28 Outlook: Credit cost expected to be around 1.5%; Growth projections to continue.
The bank remains cautious about macroeconomic factors like global tensions, RBI's monetary stance, and regional drought conditions in Maharashtra and Karnataka, though no material impact is seen yet.

The document provided is the full transcript of the earnings conference call, which included a detailed management presentation and a Q&A session with analysts.
The transcript contains extensive financial data and performance metrics for Q2 FY27 and H1 FY27, as summarized above.
The filing was digitally signed by Mr. Ranjith Raj. P, Company Secretary and Compliance Officer.