Small Finance Banks Shares: AU and Ujjivan Stocks Crash 6%, What Should Investors Do? Buy or Sell? Target Price and Upside
- October 26, 2026
- Posted by: Ankit Jaiswal
- Category: News
Small finance banks shares fell sharply on Monday, 26 Oct 2026. AU Small Finance Bank was down about 6.2% at Rs 875.40 around 10:30 AM after hitting Rs 845.40, while Ujjivan Small Finance Bank fell as much as 6.3% to Rs 54.44 before paring losses to about 2.3% at Rs 56.77. The headline attributes the fall to weak sentiment in the market, and I found no company-specific trigger.
Quick Answer
Small finance banks shares fell on 26 Oct even though both AU and Ujjivan reported strong Q2 FY27 profit growth, 53% for AU and about 200% for Ujjivan from a low base. AU’s 14-day RSI is about 14.9 and Ujjivan’s is about 26.0, which are deeply oversold readings, but both trade below their SuperTrend upper bands and their 200-day averages. Ujjivan’s brokerage targets of Rs 86 and Rs 90 date from 2 Sep and pre-date the Q2 numbers, and I could not find fresh post-Q2 targets for AU. This is educational and not a buy or sell recommendation.
Small finance banks shares are sensitive to credit-cycle fears, because the banks lend to smaller borrowers and rely on microfinance and unsecured loans. A weak market day can therefore hit the group harder than large private banks.
This article covers the price move, the Q2 numbers for both banks, valuation, technical levels, brokerage targets and the risks to check before you decide to buy or sell. It is educational and not advice.
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Small Finance Banks Shares: AU and Ujjivan at a Glance
| Small finance banks shares: measure (NSE, about 10:30 AM) | AU Small Finance Bank | Ujjivan Small Finance Bank |
|---|---|---|
| Last price | Rs 875.40 | Rs 56.77 |
| Day move | Down 6.16% | Down 2.29% |
| Previous close | Rs 932.90 | Rs 58.10 |
| Day low | Rs 845.40 (down about 9.4%) | Rs 54.44 (down about 6.3%) |
| 52-week high and low | Rs 1,144.10 and Rs 831.65 | Rs 73.94 and Rs 49.24 |
| Distance from 52-week high | About 23.5% below | About 23.2% below |
| Market capitalisation | About Rs 70,216 crore | About Rs 11,327 crore |
The distances and day-low declines are my calculations from data provider prices. Note that the Ujjivan Small Finance Bank share price recovered much of its early loss, so the headline figure of 6% describes its intraday low and not the level at 10:30 AM. The AU Small Finance Bank share price was still down more than 6% at that time, and it stayed near the day low. Small finance banks shares often move together on such days.
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Why Small Finance Banks Shares Fell
The headline says AU and Ujjivan fell amid weak sentiment in the Indian stock market. The Nifty opened weak on 26 Oct, with Business Standard reporting it down about 0.63% near 22,461 at 9:48 AM, and it later recovered to near 22,654 to 22,687. The Nifty fell 2.36% last week and the Midcap index fell 5.6%, so risk appetite for small finance banks shares is low.
I could not find a reported company-specific reason. For AU, the fall came after Q2 numbers released last week showing a 53% profit rise, and for Ujjivan it follows a decline from Rs 62.82 on 16 Oct, when the Q2 results came out, to Rs 56.77 now, a drop of about 9.6% (my calculation). Without a stated trigger, the move in small finance banks shares looks like selling driven by sentiment and by positioning.
Small Finance Banks Shares: AU Small Finance Bank Q2 FY27 Numbers
| Small finance banks shares: AU item | Q2 FY27 | Change |
|---|---|---|
| Net profit | Rs 858 crore | Up 53% from Rs 561 crore |
| Net interest income | Rs 2,820 crore | Up 32% year on year |
| Net interest margin | 5.8% | Up 33 basis points |
| Total deposits | Rs 1,70,460 crore | Up 28.6% year on year |
| CASA ratio | 29.5% | CASA deposits Rs 50,289 crore |
| Gross loan portfolio | Rs 1,53,769 crore | Up 25.1% year on year |
| Gross NPA and net NPA | 1.99% and 0.81% | Gross NPA improved 42 basis points |
| H1 net profit | Rs 1,654 crore | Up 45% |
AU’s quarter was strong on every line reported, yet the AU Small Finance Bank share price fell to Rs 875.40. The valuation helps explain why. The data provider shows a trailing price to earnings of 24.59 against an industry level of 12.28, a price to book of 3.56 and a return on equity of 14.47%, so the bank carries a premium that leaves little room for disappointment. A broad sell-off in small finance banks shares can compress that premium quickly.
Small Finance Banks Shares: Ujjivan Small Finance Bank Q2 FY27 Numbers
| Small finance banks shares: Ujjivan item | Q2 FY27 | Change |
|---|---|---|
| Net profit | Rs 365 crore | Up about 200% from Rs 121.72 crore |
| Net interest income | Rs 1,244 crore | Up 35% year on year |
| Net interest margin | 8.4% | Up 55 basis points |
| Total deposits | Rs 50,643 crore | Up 29.2% year on year |
| CASA ratio | 26% | CASA deposits Rs 13,176 crore |
| Gross loan book | Rs 45,699 crore | Up 32.1% year on year |
| Gross NPA and net NPA | 2.10% and 0.31% | Gross NPA down from 2.45% |
| Capital adequacy ratio | 20.69% | Down from 21.36% |
The 200% profit rise comes off a low base of Rs 121.72 crore a year earlier, so growth over the next quarters will look smaller. Ujjivan also lined up a preferential issue of Rs 409 crore from IFC, Bajaj Life Insurance, HDFC Life Insurance and Aditya Birla Sun Life Insurance, subject to shareholder approval. At Rs 56.77, the Ujjivan Small Finance Bank share price shows a trailing price to earnings of 9.86 against 12.28 for the industry, a price to book of 1.52 and a return on equity of 15.45%, so Ujjivan is the lower-priced of the two small finance banks shares on every valuation measure.
Small Finance Banks Shares: Technical Levels
| Small finance banks shares: indicator (daily) | AU Small Finance Bank | Ujjivan Small Finance Bank |
|---|---|---|
| 14-day RSI | About 14.9 | About 26.0 |
| 50-day average | About Rs 1,011.60 | About Rs 64.24 |
| 200-day average | About Rs 1,004.69 | About Rs 61.10 |
| SuperTrend | Sell; upper band Rs 968.78, lower band Rs 775.22 | Sell; upper band Rs 65.64, lower band Rs 46.63 |
| Bollinger lower band | Rs 912.81 | Rs 58.02 |
| Nearest support levels | Rs 845.40 (today’s low), Rs 831.65 (52-week low) | Rs 54.44 (today’s low), Rs 49.24 (52-week low) |
| Nearest resistance levels | Rs 912.81 to Rs 932.90 | Rs 58.02 to Rs 58.10 |
An RSI near 15 for AU is extremely low and is rare for a bank of its size, which tells you how sharp the fall has been. Oversold readings in small finance banks shares can lead to a bounce, but both stocks trade below their 50-day and 200-day averages and under SuperTrend resistance, so the trend is still down. These are indicator readings and not forecasts.
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Buy or Sell Small Finance Banks Shares: What Brokerages Said About Ujjivan
| Small finance banks shares: brokerage view (2 Sep 2026) | Rating | Target | Implied upside from Rs 56.77 (my calculation) |
|---|---|---|---|
| Axis Securities | Buy | Rs 86 | About 51.5% |
| ICICI Securities | Buy | Rs 90 | About 58.5% |
These Ujjivan SFB target price figures were published on 2 Sep, after the managing director’s exit, and before the Q2 results and the recent fall. Axis values the stock at 1.8 times FY28 adjusted book value, and ICICI Securities cites strong second-line management and microfinance tailwinds. The interim chief executive, Carol Furtado, was appointed with RBI approval for three months, and a permanent successor has not been named, which both brokerages flagged as a near-term uncertainty.
I could not find fresh post-Q2 targets for AU, and the older ones I found were set when the stock traded much higher, so I have not quoted them. Brokerage views on small finance banks shares can change quickly after a sharp fall. Please check the latest broker reports before you rely on any target.
Risks to Check Before You Buy or Sell Small Finance Banks Shares
- Sentiment. Small finance banks shares fall faster than large banks when markets weaken.
- Valuation. Among small finance banks shares, AU trades at 24.59 times earnings against an industry level of 12.28.
- Leadership. Ujjivan has an interim chief executive and is searching for a permanent one.
- Asset quality. Gross NPA of 2.10% at Ujjivan and 1.99% at AU is acceptable now, but unsecured lending can deteriorate quickly and hit small finance banks shares.
- Capital and dilution. Ujjivan’s Rs 409 crore preferential issue needs shareholder approval.
Conclusion
Small finance banks shares fell on 26 Oct despite strong Q2 numbers from AU and Ujjivan, and the headline puts it down to weak sentiment. The AU Small Finance Bank share price looks premium-valued and deeply oversold, the Ujjivan Small Finance Bank share price looks lower-priced but carries leadership uncertainty, and the Ujjivan SFB target price figures pre-date the latest fall. Check the facts and decide according to your own risk profile.
Disclaimer: Data and figures in this article are sourced from publicly available information. These may or may not be accurate. Please verify all data with the official NSE (nseindia.com) and BSE (bseindia.com) websites before making any investment decision. Investments in securities are subject to market risk. This content is for educational purposes only and is not investment advice by Univest (SEBI RA INH000013776).
Frequently Asked Questions
Why did small finance banks shares fall today?
Ans. The headline says AU Small Finance Bank and Ujjivan Small Finance Bank shares plunged amid weak sentiment in the Indian stock market. I could not find a company-specific trigger. AU was down about 6.2% at Rs 875.40 around 10:30 AM and Ujjivan was down about 2.3% after falling as much as 6.3%.
Should I buy or sell AU Small Finance Bank shares?
Ans. That depends on your horizon and risk profile. AU reported a 53% rise in Q2 profit to Rs 858 crore and its 14-day RSI is about 14.9, but it trades at 24.59 times earnings against an industry level of 12.28 and below its SuperTrend upper band near Rs 968.78. This is not a recommendation.
What is the Ujjivan SFB target price?
Ans. On 2 Sep, Axis Securities had a Buy with a target of Rs 86 and ICICI Securities had a Buy with a target of Rs 90. Those were set before the Q2 results and the latest fall, so please check for fresh reports.
What were AU Small Finance Bank’s Q2 results?
Ans. AU reported a Q2 FY27 net profit of Rs 858 crore, up 53% from Rs 561 crore. Net interest income was Rs 2,820 crore, net interest margin was 5.8%, deposits were Rs 1,70,460 crore and gross NPA was 1.99%. The result did not stop small finance banks shares from falling.
What were Ujjivan Small Finance Bank’s Q2 results?
Ans. Ujjivan reported a Q2 FY27 net profit of Rs 365 crore against Rs 121.72 crore a year earlier. Net interest margin was 8.4%, gross NPA was 2.10% and net NPA was 0.31%. It also lined up a Rs 409 crore preferential issue.
Are small finance banks shares oversold?
Ans. On the data provider’s daily indicators, AU’s 14-day RSI is about 14.9 and Ujjivan’s is about 26.0, both in the oversold zone. Both still trade below their 200-day averages and under SuperTrend resistance, so an oversold reading does not mean a rebound is certain.
Is this small finance banks shares article investment advice?
Ans. No. This article is educational. Prices, ratios and targets come from data providers and news reports and may change. Please check the facts and your own risk profile before you buy or sell.
Is this article investment advice?
Ans. No. It is educational and not a recommendation to buy or sell. Please check the figures against company filings and your own risk profile before you act on anything you read here.
