💰 Financial Performance

Revenue Growth by Segment

Total Revenue grew 14% YoY to INR 3,068 Cr in H1 FY26 from INR 2,698 Cr in H1 FY25. Secured assets, which now form 73% of the book, saw MSME growth of 27% YoY and Gold Loans growth of 204% YoY. Unsecured business growth was moderated to 0.3% in Q2 FY26 to manage credit risk.

Geographic Revenue Split

Not disclosed in available documents; however, the bank operates through a zonal-level committee structure indicating a pan-India presence focused on 'Rising India' segments.

Profitability Margins

Net Interest Margin (NIM) moderated to 6.6% in Q2 FY26 from 6.7% in Q1 FY26. Return on Assets (RoA) declined to 0.9% in H1 FY26 from 1.6% in H1 FY25. Return on Equity (RoE) fell to 8.4% in H1 FY26 from 14.3% in H1 FY25, primarily due to a higher capital base post-IPO and accelerated provisions of INR 232 Cr.

EBITDA Margin

Pre-Provision Operating Profit (PPOP) stood at INR 577 Cr for H1 FY26, a decline from INR 654 Cr in H1 FY25. This reflects a Cost-to-Income ratio increase to 66.6% in H1 FY26 from 58.3% in H1 FY25 due to higher upfront acquisition costs in secured lending.

Capital Expenditure

Not disclosed as a single INR figure, but the bank significantly expanded its capital base through an IPO of INR 462 Cr in Q4 FY24 and recently received INR 250 Cr in Tier 1 capital in October 2025.

Credit Rating & Borrowing

The bank maintains a gearing ratio of 7.5 times as of December 2024. It has access to INR 850 Cr of NHB funding. Cost of funds has shown a downward trend despite growth, supported by a Liquidity Coverage Ratio (LCR) of 170%.

⚙️ Operational Drivers

Raw Materials

The primary 'raw material' is cost of deposits/capital. Retail deposits make up 62.1% of total deposits, with 91.7% of these contracted for 1 year and above to lock in funding costs.

Import Sources

Not applicable for banking operations; sourcing is domestic through branch banking and strategic alliances.

Key Suppliers

Not applicable; the bank sources funds from retail and bulk depositors and provides credit through partners like CGTMSE for guarantee coverage.

Capacity Expansion

Current Gross Loan Portfolio (GLP) is INR 31,655 Cr as of Q2 FY26, with a planned expansion to approximately INR 35,500 Cr by March 2026, representing a ~20% growth target.

Raw Material Costs

Interest expenses are the primary cost. The bank is focused on driving CASA (Current Account Savings Account) which grew 19.8% YoY to improve the cost of funds. Bulk deposits are 87.9% contracted for 1 year and above.

Manufacturing Efficiency

Operational efficiency is measured by the Cost-to-Income ratio, which was 67.8% in Q2 FY26. The bank aims to improve this as the MFI book resumes growth and converts the existing cost base into better revenue.

Logistics & Distribution

Distribution is handled via 8,000-9,000 MFI-focused employees. Sourcing costs for secured assets are expensed upfront rather than amortized, creating a INR 15 Cr negative carry in high-growth quarters.

📈 Strategic Growth

Expected Growth Rate

20%

Growth Strategy

The bank will achieve this through a 'Secured First' strategy, aiming for 80% secured assets. It is aggressively growing Gold Loans (204% YoY) and MSME (27% YoY) while transitioning the unsecured MFI book to guarantee programs (expected 16-17% of total book under guarantee by March 2026).

Products & Services

Savings accounts, Current accounts, Fixed Deposits, Recurring Deposits, MSME loans, Two-Wheeler finance, Gold loans, and Microfinance (MFI) loans.

Brand Portfolio

Jana Small Finance Bank, Jana Bank.

New Products/Services

Expansion of Gold Loan and Two-Wheeler segments; the bank is also in the process of obtaining a Universal Banking license which would allow for a broader product suite.

Market Expansion

Targeting 'Rising India' customers with a focus on increasing the secured business proportion each year and building a sustainable, predictable franchise.

Market Share & Ranking

Recognized as Runner-up for 'Best Small Finance Bank in Growth' by the Indian Chambers of Commerce in 2025.

Strategic Alliances

Strategic alliance with CGTMSE for credit guarantees; the bank received the 'Highest Guarantee Coverage FY 2025' award from them.

🌍 External Factors

Industry Trends

The Small Finance Bank industry is evolving toward secured lending to mitigate the volatility of microfinance. JSFB is positioning itself as an 'anchor bank' for Rising India by offering single KYC and multiple products to increase customer stickiness.

Competitive Landscape

Competes with other Small Finance Banks and private banks; JSFB differentiates through its high share of secured advances (73%) compared to MFI-heavy peers.

Competitive Moat

The moat is built on a granular, long-term retail deposit base (91.7% over 1 year) and high standards of governance. This is sustainable because it reduces reliance on volatile wholesale funding and lowers the overall cost of funds over time.

Macro Economic Sensitivity

Sensitive to rural economic cycles and inflation, which impact MFI repayment capabilities. The bank noted substantial uncertainty in global growth due to tariff postponements and supply chain inflationary pressures.

Consumer Behavior

Shift toward digital banking and a demand for multiple products (assets and liabilities) from a single provider, which the bank is addressing through its 'anchor bank' strategy.

Geopolitical Risks

Global trade wars and restrictions on Chinese goods are noted as potential deflationary or inflationary risks that could affect the broader Indian economy and banking credit quality.

⚖️ Regulatory & Governance

Industry Regulations

The bank is subject to RBI Small Finance Bank norms and is currently undergoing the application process for a Universal Banking license, which involves rigorous banking and technology audits.

Taxation Policy Impact

The bank benefits from accumulated Deferred Tax Assets (DTA) due to past losses, which limits income tax liabilities. INR 30 Cr of DTA was recognized in FY25, with benefits expected to last until FY2027.

Legal Contingencies

The bank identifies 'Legal Risk' within its operational risk framework, including exposure to penalties and civil litigation. Specific pending case values in INR Cr are not disclosed in the provided documents.

⚠️ Risk Analysis

Key Uncertainties

MFI sector leverage and repayment volatility pose a risk to PAT growth, which is guided at a conservative 0-2% for FY26. Slippages in the unsecured book remain a key monitorable.

Geographic Concentration Risk

Not disclosed as specific percentages, but the bank uses zonal-level committees to manage regional risks.

Third Party Dependencies

Dependency on Business Correspondents for MFI sourcing and CGTMSE for credit guarantees on 16-17% of the loan book.

Technology Obsolescence Risk

The bank is mitigating technology risk through comprehensive audits required for the Universal Banking license and a well-defined BCP (Business Continuity Plan) for IT processes.

Credit & Counterparty Risk

Gross NPA stood at 2.8% and Net NPA at 0.9% in H1 FY26. The bank is tightening credit sourcing norms for MFI to be 'tighter than industry norms' to improve receivables quality.