UJJIVAN FINANCIAL SERVICES 2022-23 Annual Report Analysis

Mon, 10 Jul

UJJIVAN FINANCIAL SERVICES has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during the year 2022-23.

UJJIVAN FINANCIAL SERVICES Income Statement Analysis

• Interest income during the year rose 47.6% on a year-on-year (YoY) basis.
• Interest expenses were up by 39.4% YoY during the same period.
• Operating expenses declined by 26.7% YoY during the year.
• The company's net interest income (NII) increased by 52.2% YoY during the fiscal. Consequently, net interest margins (NIM) witnessed a decline and stood at 33.9% in FY23 as against 45.3% in FY22.
• Other income increased by 261.7% YoY during the year.
• Net profit for the year increased by 564.7% YoY.
• Net profit margins during the year increased to 20.1% in FY23 from -6.4% in FY22.

UJJIVAN FINANCIAL SERVICES Income Statement – 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Interest Income	Rs m	29,952	44,213	47.6%
Other Income	Rs m	990	3,582	261.7%
Interest Expense	Rs m	10,711	14,931	39.4%
Net Interest Income	Rs m	19,241	29,282	52.2%
Operating Expense	Rs m	21,720	15,928	-26.7%
Pre-provision Operating Profit	Rs m	-1,489	16,936	1237.4%
Provisions & Contingencies	Rs m	1,141	1,138	-0.3%
Profit before tax	Rs m	-3,040	15,308	603.6%
Tax	Rs m	-735	3,905	631.5%
Profit after tax	Rs m	-1,917	8,907	564.7%
Minority Interest	Rs m	388	-2,496	-743.0%
Net Interest Margin	%	45.3	33.9
Net profit margin	%	-6.4	20.1

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UJJIVAN FINANCIAL SERVICES Balance Sheet Analysis

• The company's deposits during FY23 stood at Rs 0 m as compared to Rs 0 m in FY22, thereby witnessing an increase of 0.0%.
• Advances for the year stood at Rs 0 m as compared to Rs 0 m during FY22, a rise of 0.0%.
• Cost of deposits for UJJIVAN FINANCIAL SERVICES rose 47.0% and stood at 1306730.0%, while yield on advances rose to 0.0%.
• The lender's investments rose to Rs 86.4 bn during the year from Rs 42.5 bn in FY22.
• Borrowing stood at Rs 0 m, a growth of 0.0% as compared to previous year.
• Overall, the total assets and liabilities for FY23 stood at Rs 351.5 bn as against Rs 240.1 bn during FY22, thereby witnessing a rise of 46.4%.

UJJIVAN FINANCIAL SERVICES Balance Sheet – as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	22,562	31,622	40.2%
Advances	Rs m	0	0	0.0%
Deposits	Rs m	0	0	0.0%
Yield on advances	%	0.0	0.0
Cost of Deposits	%	888680.0	1306730.0
Investments	Rs m	42,483	86,441	103.5%
Borrowings	Rs m	0	0	0.0%
Total Assets	Rs m	240,088	351,533	46.4%

Current Valuations for UJJIVAN FINANCIAL SERVICES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 73.2, an improvement from the EPS of Rs -15.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 409.6, stands at 2.8 times its trailing twelve months earnings.
• The price to adjusted book value (P/ABV) ratio at current price levels stands at 1.6 times, while the price to income ratio stands at 0.6 times.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Income per share (Unadj.)	Rs	246.1	363.4
Earnings per share (Unadj.)	Rs	-15.8	73.2
Diluted earnings per share	Rs	-15.8	73.2
Avg P/E ratio	Rs	-11.4	2.8
Avg P/ABV ratio	Rs	0.8	1.6
Avg Market Cap	Rs	21,768	25,321
Dividends per share (Unadj.)	Rs	0.00	5.00

Ratio Analysis for UJJIVAN FINANCIAL SERVICES

• Efficiency Ratios

  Credit/Deposit Ratio: The company's credit/deposit ratio improved and stood at 0.0x during FY23, from 0.0x during FY22. The credit/deposit ratio tells us how much money a company has raised in the form of deposits and has deployed as loans.

  Debt to Equity Ratio: The company's debt to equity ratio increased and stood at 0.00x during FY23, from 0.00x during FY22. The debt to equity ratio of a company tells us how much debt a company uses relative to its equity.

• Liquidity Ratios

  Capital Adequacy Ratio (CAR): UJJIVAN FINANCIAL SERVICES's capital adequacy ratio (CAR) was at 25.8% as on 31 March 2023 as compared to 19.0% a year ago. This ratio helps measure the financial strength of the company or any finance company to meet their obligations using their assets and capital.

  A company that has a good CAR has enough capital to absorb potential losses. Thus, it has less risk of becoming insolvent and losing depositor's money.

  Provision Coverage Ratio (PCR): Apart from CAR, you also need to take a look at the company's PCR and LCR ratios. Provisioning coverage ratio (PCR) is the percentage of funds that a company sets aside for covering losses due to bad debts.

  So a high PCR ratio means asset quality issues are under control and the company is not vulnerable.

  Liquidity Coverage Ratio (LCR): The LCR is designed to ensure that companies hold a sufficient reserve of high-quality liquid assets to allow them to survive a period of significant liquidity stress lasting 30 calendar days.

• Profitability Ratios

  Return on Equity (ROE): The return on equity (ROE) ratio for the company improved and stood at 28.2% during FY23, from -8.5% during FY22. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

  Return on Assets (ROA): The return on asset (ROA) ratio of the company improved and stood at 2.53% during FY23, from -0.80% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

  Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 10.69% during FY23, from 3.66% during FY22. The ROCE measures the ability of a company to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

• NPA Ratios

  Gross NPA Ratio: The gross NPA ratio is the ratio of a company's gross NPAs to gross advances. UJJIVAN FINANCIAL SERVICES's gross NPA ratio stood at 0.0% as of 31 March 2023 compared to 0.0% in the same period a year ago.

  A high gross NPA ratio is a bad thing as it indicates how much of a company's loans are in danger of not being repaid.

  Net NPA Ratio: In simple language, net NPAs are simply the total non-performing assets minus the provision left aside. It gives you the exact value of NPAs after the company has made provisions.

  The net NPA ratio of UJJIVAN FINANCIAL SERVICES was 0.0% in financial year 2023. This compared with 0.0% a year ago.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Credit/Deposit Ratio	x	0.0	0.0
Debt to Equity Ratio	x	0.0	0.0
Loans / Deposits	x	0.0	0.0
Capital Adequacy Ratio	%	19.0	25.8
Return on Equity	%	-8.5	28.2
Return on Assets	%	-0.8	2.5
Return on Capital Employed	%	3.7	10.7
% of Gross NPAs	%	0.0	0.0
% of Net NPAs	%	0.0	0.0
Yield on Advances	x	0.0	0.0
Yield on Investments	x	0.0	0.0

To see how UJJIVAN FINANCIAL SERVICES has performed over the last 5 years, please visit here.

UJJIVAN FINANCIAL SERVICES Share Price Performance

Over the last one year, UJJIVAN FINANCIAL SERVICES share price has moved up from Rs 155.7 to Rs 409.6, registering a gain of Rs 253.9 or around 163.1%.

Overall, the S&P BSE SENSEX is up 23.0% over the year.

(To know more, you can check out historical annual results for UJJIVAN FINANCIAL SERVICES here and quarterly results for UJJIVAN FINANCIAL SERVICES here)