UBS on Poonawala Fin ; Buy, TP Rs 600

reported strong AUM growth of 10% QoQ/55% YoY slightly ahead of estimate, reaching Rs740bn. Newer segments including Prime Personal Loans, Gold and Education drove stronger growth momentum. NII grew 80% YoY, 5% beat on UBSe with calculated margins expanding QoQ by 31bps, driven by increase in yield on loans. PPOP grew 11% QoQ and was largely in-line as non-interest income was weaker than expected. Asset quality continued to show improvement as credit cost declined more than 20bps QoQ . RoA, as a result, improved to 2.1% from 1.9% in Q1, up 19bp QoQ

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