AU Small Finance Bank Q1 profit up 37%, targets ROA lift

AU Small Finance Bank's first-quarter net profit rose 37% to ₹796 crore, with deposits up 24% and loans up 23% year on year. Asset quality improved with lower slippages. Management guided for return on assets to improve from 1.7% to 1.8% over the next six to nine months, and plans to add over 100 branches this year. Technology spending ran at 12-13% of operating expenses, above the previously communicated range, reflecting upfront investment in digital scaling. The near-term margin trajectory remains opaque. A steady-state quarter with no surprises; the call offered incremental colour on guidance without shifting the investment thesis.