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Ujjivan Financial and Bharat Financial Untouched From Demonetization

Dynamic Equities Pvt Ltd | 06 Dec, 2016  | Follow Author | Add to my Favourites 
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India's cash-dominated microfinance sector may have been hurt the most by the Modi  government's demonetization move, but sector leaders like Ujjivan Financial Services and Bharat Financial Inclusion are all out to show that all is well.

But, industry leaders are not too confident of the sector matching the 84% growth the NBFC-MFI sector recorded last year. This is because MFIs are now lending only to existing borrowers and limiting the number of new borrowers.

About Ujjivan:

Ujjivan on Monday announced a repayment rate of 91% in November. It disburses about Rs 20 crore per day. These lenders have made sure that it is business as usual by recycling cash collected from borrowers as repayments.


R Baskar Babu, chief executive of Suryoday Micro Finance and president of Microfinance Institutions Network, an industry lobby said that the ground-level situation has shown sharp improvement from the initial few weeks of November. Borrowers have shown first-rate repayment discipline.

Ujjivan share price rose 0.54% to Rs 346.10 on NSE after the repayment announcement. It had closed at Rs. 442.55 on November 9th. Also, Ujjivan is the top 500 performing stock as identified by Dynamic Levels for the quarter.

Ujjivan chief financial officer Sudha Suresh had informed that poll-bound Uttar Pradesh lagged behind with a 79-80% repayment rate.  Quite a few borrowers in Uttar Pradesh, Madhya Pradesh and Maharasthra had stopped repaying as there were rumors about loan waivers. The microfinance industry had to seek the help of state governments to suppress these rumors.

Ujjivan Financial Services Limited, the fourth financial institution to receive the final small finance bank license from the Reserve Bank of India (RBI), said it disbursed loans worth Rs. 553 crore in November, of which 65% was in cash.

Suresh said Ujjivan pays out around Rs 600 crore a month during the October to December period, but a drop in new business led to a decline in disbursal this November. The Bengaluru-based entity had primarily deferred its repayment from November 9 to November 13.

At Bharat Financial:

Bharat Financial declared a repayment cessation on November 11 at 92% of its branches. Bharat Financial's disclosures show remarkable resilience in collections, with collective 89% of installments due since demonetization announcements being collected. Bharat Financial inclusion Limited informed the BSE it had a collection efficiency of 97% in the two weeks post demonetization. Bharat financial share price had closed at Rs. 770.50 on 9th November as compared to its close of Rs. 741.30 on 8th November. Bharat Financial is also identified among the top 500 performing stocks for the quarter by Dynamic Levels.

Bharat Financial and Ujjivan today:

Today, Ujjivan share price opened at Rs. 350.10, 1.37% above its previous close of Rs. 345.35. At 9:30 Am, the stock was trading at Rs. 350.25, up by 1.42% and below its 50 DMA.

Bharat Financial share price opened at Rs. 709 as compared to its previous close of Rs. 707.60. Currently, the stock was trading at Rs. 719.25, up by 1.65% and below its 50 DMA.


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About Dynamic Equities Pvt Ltd

Dynamic Equities Pvt. Ltd. is a a SEBI Registered Investment Advisor and Stock Broker, a leading financial services provider, and one of the major players in the Equity markets in India. With an experience of over 15+ years in Stock Markets and Equity Research, they provide daily updated Support & Resistance of 4200 instruments across 93 exchanges and 56 countries globally. They have an in-house team of over 25 analysts. Under the guidance and mentorship of Mr. Shailesh Saraf, MD of Dynamic Equities Pvt. Ltd., these analysts are dedicately involved in guiding their clients and users of the website for trading in the market. Mr. Shailesh Saraf has an experience of over 24 years in the financial market, especially in capital & derivatives market operations, trading, research and management related areas. Dynamic Levels is a website owned by Dynamic Equities Pvt. Ltd. The website can be reached at

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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor accept any liability whatsoever arising from the use of any of the above contents.

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