AU Small Finance Bank – Resilient Recovery with Strong Earnings

📊Technical Analysis

IPO & COVID Dip: Listed around ₹270 in 2017 → surged to ₹600 by 2020, then fell below ₹200 during the COVID crash.

Post-COVID Recovery: Strong bounce from ₹180–₹200 with classic higher highs and higher lows → hit ₹813 all-time high in January 2024.

Correction Phase: Decline followed into late 2024–2025, forming a descending channel.

Breakout Trigger: Q4 FY25 results announced on 22nd April triggered a breakout of the recent lower highs on 9th June, lifting the stock to ₹781.

Key Levels:

🎯Upside Targets: ₹813 → ₹830 → ₹875

🔻Supports: ₹750 (minor), ₹700 (major). Breach of these would negate the bullish case.

💰FY24 Financial Highlights:

• Total Income: ₹16,064 Cr (vs ₹10,555 Cr in FY23; ₹8,205 Cr in FY22)
  
• Total Interest Income: ₹8,052 Cr (vs ₹5,398 Cr in FY23; ₹3,780 Cr in FY22)
  
• Total Expenses: ₹7,750 Cr (vs ₹4,678 Cr in FY23; ₹3,410 Cr in FY22)
  
• Financing Profit: ₹262 Cr (vs ₹479 Cr in FY23; ₹1,015 Cr in FY22)
  
• Profit Before Tax: ₹2,788 Cr (vs ₹1,999 Cr in FY23; ₹1,865 Cr in FY22)
  
• Profit After Tax: ₹2,106 Cr (vs ₹1,535 Cr in FY23; ₹1,428 Cr in FY22)
  
• Diluted Normalized EPS: ₹28.29 (vs ₹22.93 in FY23; ₹21.42 in FY22)
  
  📌Strong YoY improvement across revenue, expense control, and earnings highlights solid execution and scale.
  
  🔍Fundamental Highlights
  
  Net Interest Income (NII) rose 55% YoY to ₹8,012 Cr (FY25)
  
  Other Income increased 49% YoY to ₹2,526 Cr (FY25)
  
  Profit After Tax grew 32% YoY to ₹2,106 Cr (FY25)
  
  Cost-to-Income ratio improved ~7% to ~57%
  
  Net Interest Margin (NIM) rose to 5.94% (FY25) from 5.45% (FY24)
  
  Asset Quality: GNPA of 2.28%, NNPA at 0.74%; strong provisioning coverage of 84%
  
  Deposit & Loan Growth: Deposits up 27%, Advances up 20%; CASA at 29%
  
  Dividend Announcement: ₹1 per share final dividend approved
  
  Future Growth Outlook: Projected 30% earnings CAGR (FY24–27)
  
  Universal Bank Ambition: Applied for RBI universal banking licence
  
  ✅Conclusion
  AU Small Finance Bank is showing a strong turnaround with breakout momentum and outstanding financial results:
  
  📈Bullish Setup: Breakout above the descending channel and recent high at ₹780 ↗️
  
  📌Volume Validation: Q4 rally supported by improved trading activity
  
  🎯Targets: ₹813 → ₹830 → ₹875
  
  🚨Supports to Watch: ₹750 → ₹700 (violation may derail the bounce momentum)
  
  With resilient revenue, improved margins, and credit growth, AU Small Finance Bank appears well-positioned for the next leg up—provided key support holds.
  
  Disclaimer:lnkd.in/gJJDnvn2