Despite growth and liquidity concerns, this stock has risen over 50% in the last one year

Ujjivan Financial Services rose for six straight sessions ahead of the small finance bank's IPO, rising over 16 percent.

In Q2, the company reported over two-fold jump in consolidated net profit at Rs 93 crore as against a profit of Rs 44.3 crore in the year-ago period. Its total income also increased 55 percent to Rs 710 crore in Q2 as against Rs 459.04 crore in Q2FY19.

Edelweiss in a recent report said that Ujjivan Financial Services has beaten estimates on all counts by reporting a strong set of numbers for Q2FY20, led by strong growth in disbursements and, therefore, in the AUM. Strong growth in net revenue and pre-provisioning operating profit on account of robust growth in AUMs and overall control in operating expenses led to the PAT more than doubling on a year-on-year basis.

Global brokerage Macquarie raised its target price to Rs 325 from Rs 260 per share, while maintaining a 'neutral' stance on the stock. Ujjivan SFB listing is imminent and pre-IPO deal values the company at 1.7 times the estimated FY21 book value, the research house said, adding that the promoter stake sale/reverse merger is now a new monitorable.

Ujjivan Financial Services went public in 2016 after receiving an in-principle licence from the Reserve Bank of India to start a small finance bank.