India, Feb. 28 -- During FY24, Utkarsh Small Finance Bank achieved the best financial year ever in its entire history, a record-breaking net profit of Rs 498 crore, a very good return on equity, a clean asset quality, and a stock that got investors excited about the microfinance growth story in India. Jump to just six quarters later, Q3 FY26, and the same bank reported a net loss of Rs 375 crore in a single quarter, thus revealing a drastic fall in profitability.

However, here is the twist: this is exactly when institutional investors decided to invest big time. FIIs increased their stake by 10.12%, whereas DIIs increased their stake by 7.35%. Combined, some of the most analytically rigorous minds on the planet, having looked at a bank ...