Shares of AU Small Finance Bank Ltd. have an upside potential of over 19%, according to a note from brokerage firm Jefferies on Monday, October 13.

The brokerage has initiated coverage on the stock with a "buy" rating and a price target of ₹910 per share.

It is of the view that the lender is at an interesting juncture, where the transition from a small finance bank to a universal bank can lower funding cost, lift fees and strengthen the brand to aid growth.

In August , the Reserve Bank of India (RBI) gave the lender its 'in-principle' approval to transition into a universal bank. AU Small Finance Bank had applied for the licence in September 2024.

The lender's profitability can improve from December 2025, led by a decline in deposit rates and credit costs, according to the Jefferies

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