Ujjivan eyes common financial institution nod by December, plans Rs 2,000 crore QIP in 24 months
Ujjivan Small Finance Financial institution (SFB) expects readability on its common banking licence utility by December this 12 months. The financial institution additionally plans to boost round Rs 2,000 crore by means of a professional institutional placement (QIP) over the subsequent 18–24 months to assist progress, says Sanjeev Nautiyal, MD and CEO, Ujjivan Small Finance Financial institution.
The financial institution confirmed that its utility, filed in February, has gone by means of a number of rounds of clarifications with the central financial institution and is now in a complicated stage of processing. “We stay hopeful our credibility, integrity and observe document,” Nautiyal mentioned, whereas underlining that the plan to increase stays unchanged whatever the consequence.
The administration confused that its five-year roadmap is impartial of the RBI’s resolution, although a conversion right into a common financial institution would open extra doorways and alternatives for the lender.
On the expansion aspect, Ujjivan reiterated its dedication to enterprise and microfinance loans, highlighting that its underwriting, buyer choice and assortment mechanisms have left its ebook more healthy than the business throughout latest headwinds.
The administration additionally clarified that its capital-raising plans are tied to its broader steadiness sheet objective of reaching a Rs 1 lakh crore gross mortgage ebook by 2030. “This 2,000 crore is a part of our strategic plan and is no matter the RBI’s resolution,” they mentioned.
The financial institution is concurrently stepping up its expertise investments. It at the moment spends about Rs 200 crore yearly on IT, three-fourths on working operations and a fourth on new initiatives however expects to scale this as much as almost Rs 500 crore over the subsequent 5 years.
Retail lending stays the mainstay, accounting for over 90% of the steadiness sheet, with a deliberate shift in the direction of secured loans. The share of secured property has risen from 30% in March 2024 to 46% by June, and is projected to climb to 65–70% by FY30. This diversification, administration famous, would carry stability, scale back volatility, and improve earnings visibility.
On the microfinance portfolio, Ujjivan acknowledged the stress the sector confronted previously decade however mentioned delinquencies have peaked throughout most states, and restoration is underway. “The pains are already behind us… progress is across the nook,” Nautiyal added.
Wanting forward, Ujjivan maintains {that a} common financial institution licence could be an optimum consequence to execute its technique quicker and make its model extra aggressive, however the give attention to grassroots MSMEs, retail debtors, and technology-led progress will proceed no matter regulatory selections.
