Equitas Small Finance Bank has announced plans to bolster its capital reserves through a ₹1,250 crore qualified institutional placement (QIP). The initiative, approved by the bank’s board on May 30, 2025, is designed to strengthen the balance sheet and support long-term business objectives. The proposed QIP is subject to approval from shareholders and regulatory authorities.
The bank stated that the capital raise will be executed through QIP, which allows listed companies to raise funds by issuing equity shares to qualified institutional buyers. A capital raising committee has been formed to finalise the terms, conditions, pricing, and timing of the issue.
According to the company filing, the QIP will enhance the bank’s ability to support growth plans and manage future capital requirements effectively. The move comes amid an increasingly competitive environment in the financial services sector, where capital strength plays a critical role in scaling operations and absorbing potential stress.
In its quarterly financial report for the March 2025 quarter (Q4 FY25), Equitas Small Finance Bank reported a net profit of ₹42.1 crore, a sharp decline from ₹207.6 crore recorded in the same quarter of the previous financial year.
Despite the drop in profit, net interest income (NII), a key indicator of a bank’s core lending business, grew 5% year-on-year to ₹829.5 crore, reflecting resilience in income from loans and advances.
The bank’s asset quality showed a slight improvement in some areas while registering minor deterioration in others. The gross non-performing asset (GNPA) ratio came down marginally to 2.89%, compared to 2.97% in the December 2024 quarter. However, the net NPA ratio increased slightly to 0.98%, up from 0.96%.
As of March 2025, the gross NPAs stood at ₹1,067.7 crore, a slight improvement from ₹1,071.9 crore in the previous quarter. The bank’s provisioning efforts appear to be ongoing as it continues to manage asset quality amid economic fluctuations.
Equitas Small Finance Bank reported a capital adequacy ratio (CAR) of 23.1%, which indicates sufficient capital buffers to absorb potential losses and support risk-weighted assets. The liquidity coverage ratio (LCR) was reported at 120%, comfortably above the regulatory threshold, reflecting a strong position to meet short-term obligations.
On May 30, 2025, Equitas Small Finance Bank share price opened flat at ₹63.60 on the NSE. By the end of the trading session, the stock closed slightly higher at ₹63.89. The 52-week high of ₹107.80 was recorded on June 20, 2024. The 52-week low of ₹52.52 was touched on April 7, 2025.
Equitas Small Finance Bank’s decision to raise ₹1,250 crore via QIP marks a strategic move to reinforce its capital structure. While the decline in Q4 profit highlights certain operational pressures, stable net interest income, controlled asset quality, and strong capital metrics provide a foundation for future growth. The proposed capital infusion is expected to strengthen the bank’s position as it navigates a dynamic banking environment.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Investments in the securities market are subject to market risks, read all the related documents carefully before investing.
Published on: May 30, 2025, 6:14 PM IST
Akshay Shivalkar
Akshay Shivalkar is a financial content specialist who strategises and creates SEO-optimised content on the stock market, mutual funds, and other investment products. With experience in fintech and asset management, he simplifies complex financial concepts to help investors make informed decisions through his writing.
Know MoreWe're Live on WhatsApp! Join our channel for market insights & updates
Get the link to download the App
