Shares of Suryoday Small Finance Bank rose 5% in early trade after solid fourth-quarter results. Shares of Suryoday Small Finance Bank were up 4.52% at Rs 130 on the NSE at 9:40 am.

Suryoday Small Finance Bank on May 15 posted a net profit of Rs 39 crore for Q3FY22-23 on the back of lower non-performing loans. The bank posted a net loss of Rs 48 crore in the year-ago period. Total revenue in the fourth quarter of FY23 surged to Rs 363 crore from Rs 257 crore a year earlier, Suryoday Small Finance Bank said in a regulatory filing.

Interest income also rose to Rs 329 crore from Rs 237 crore a year earlier. The lender’s asset quality has improved, with gross non-performing assets (NPA) falling sharply to 3.13% of gross advances as of March 31, 2023, from 11.8% a year ago. Likewise, net non-performing or non-performing loans fell to 1.55% from 5.97% a year earlier.

As a result, the bank provided Rs 51 crore for non-performing loans and contingencies, compared to Rs 112 crore in the same period last year. For the full FY22-23, the bank posted a net profit of Rs 78 crore, compared to a loss of Rs 93 crore in the previous fiscal.

Commenting on the results, Suryoday Small Finance Bank MD Baskar Babu said the bank’s expenses in FY23 stood at Rs 5,083 crore, an increase of 44.1% from Rs 3,528 crore in the previous year.

Looking ahead to FY24, he said, the bank aims to focus on growing gross advances by 30% and deposits by 35%, achieving a return on assets (ROA) of 2.2% and a return on equity (ROE) of 15%. He said key focus areas include product diversification, keeping GNPA levels below 2% and NNPA levels below 0.5%, and leveraging digital initiatives through multiple applications.