Q4 Surprise: Jana Small Finance Bank’s Earnings Tumble-Opportunity or Red Flag?

Jana Small Finance Bank stock fell 3% after the lender posted a steep 61.6% year-on-year drop in net profit for the fourth quarter ended March 31, 2025. Net profit fell to ₹123.4 crore from ₹321.6 crore in the same period last year, which impacted due to accelerated provisions as well as an unfavorable operating climate. Though its net interest income (NII) rose 0.9% to ₹597 crore, indicating its core lending business is strong, despite the sharp dip in profitability.

 

Asset quality was stable, with gross non-performing assets (GNPA) easing marginally to 2.71% from 2.80% in the earlier quarter, and net NPA remaining flat at 0.94%. Total deposits of the bank grew 29% year-on-year to ₹29,120 crore, with term deposits increasing 32% and CASA deposits up 18%. The credit-to-deposit ratio was better at 93.3%, and assets under management (AUM) increased 19% to ₹29,545 crore led by a 40% rise in secured loans.

 

Profit before tax was at ₹474 crore after making provisions of ₹305 crore. The capital adequacy ratio improved to 20.7%, and the liquidity coverage was strong at 253%. As the Q4 profit decline depressed the market sentiment, analysts pointed out the bank's strong deposit growth and stable asset quality as encouraging signs for future pick-up.

 

Sources: CNBC TV18, Economic Times, MarketScreener