Can the waning impact of second wave help Ujjivan SFB re-rate?
High slippage and provision will keep most investors on the sidelines, risk-takers should start looking at the stock of Ujjivan SFB, which is now available at a huge discount to its IPO valuation
July 05, 2021 / 04:54 PM IST
PRO Only Highlights
Quarterly performance largely backed by improved realisations
Medium-term triggers China plus and protectionist measures for tyre industry
Valuations not inexpensive; but improved medium-term outlook
Lenders at the bottom of the pyramid are expected to bear a bigger brunt of the pandemic with most of the borrowers unable to service loans as economic activities got disrupted because of repeated lockdowns. Against this backdrop, why look at a lender like Ujjivan Small Finance Bank (USFB, CMP: Rs 30.65, Market Cap: Rs 5297) that derives close to 72 per cent of its book from micro unsecured borrowers?
Prima facie, investment in these lenders is more suited for...