Utkarsh Small Finance Bank shares in focus after board approves ₹950 crore rights issue

Shares of Utkarsh Small Finance Bank will be in focus on Friday, October 3, after the company's board approved raising funds worth ₹950 crore through a rights issue.

The board will meet next on October 8 to determine the issue price, rights entitlement ratio and the record date for the rights issue.

Utkarsh Small Finance Bank has reported losses in two out of the last three quarters. The third quarter of financial year 2025 saw the lender report a net loss of ₹168 crore, a net profit of just ₹3 crore in the fourth quarter, and a net loss of ₹239 crore in the June quarter of the current financial year.

As a result, the lender's net worth declined by 8% at the end of the June quarter, from 2,975 crore to ₹2,739 crore.

During the June quarter, Utkarsh SFB's net interest margins (NIMs) declined by 50 basis points from the previous quarter, while credit costs went up by 380 basis points to 8.5% from 4.7%.

Collection efficiency declined to 82% from 86% previously, while gross NPA increased by 200 basis points to 11.4%. Net NPA also increased to 5% from 4.8% in March. Loan book declined by 2.2% from the previous quarter, while deposits saw a 0.4% drop.

Shares of Utkarsh Small Finance Bank ended 3.7% higher on Friday at ₹21.75. The stock is down more than 50% from its 52-week high of ₹46.39 and also trades below its IPO price of ₹25 per share.