ASA International – these shares, at 264p, could so easily double in price and still be an attractive purchase

Mark Watson-Mitchell - 28.07.26

Way back in 2007, the Bill and Melinda Gates Foundation made a $20m loan to the newly formed ASA International Group (LON:ASAI).

Today that company is one of the world's largest international microfinance institutions, with a strong commitment to financial inclusion and socio-economic progress.

Its shares are now trading at around the 264p level – however, there is still so much more to go for by investing in this £264m-capitalised group’s shares.

Shares up 391% in 21 months - with still so much more to rise

This coming Thursday, 29^th July, the group will be issuing a Trading Update for its six months to end-June – they could be very positive, leaving analysts confident of a near 25% increase in its 2026 profits.

Furthermore, they might well indicate that upgrades to current estimates should be required.

The Business

Microfinance is the provision of financial services to the poor.

This involves small amounts of savings, credit, insurance and money transfer services.

There is significant net demand for such financial services in many areas of the developing world, especially in rural areas. 

Today this £264m-capitalised group is one of the world's largest international microfinance institutions, with a strong commitment to financial inclusion and socioeconomic progress.

The company provides small, socially responsible loans to low-income, financially underserved entrepreneurs, predominantly women, across South Asia, South East Asia, West and East Africa.

The ASA operating (lending) model is focused on six distinctive features, emphasising the group’s social responsibility commitment to clients and staff: 

• Loans with market-based interest rates. 

• Group selection without joint liability. 

• Collateral-free loans with a moratorium on loan repayments in emergency situations. 

• Loans for income-generating activity only. 

• Full repayment before qualifying for new loans and repeat loan cycles with set limits. 

• Training and development of operating staff in-house and no bonus incentive.

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AGM Trading Update

On Thursday, 30^th April, in its AGM Trading Update, the group reported a strong start to 2026, with its Gross Outstanding Loan Portfolio reaching $583.2m as of end-March, which was a massive 25% increase year-on-year, driven by growth in Pakistan, Uganda, and Kenya.

Significant progress was made in winding down the group’s Indian operations, reducing clients by 75% and the loan portfolio by 76% to $7.2m, generating an accounting gain of $11.4m.

Across the group its client base, excluding India, expanded by 12% to 2.7m.

The company also successfully launched its enhanced banking platform and digital financial services app in Tanzania.

Management Comment

CEO Rob Keijsers stated that:

"Q1 2026 demonstrates the underlying strength and discipline of ASA International's platform.

Across our continuing operating platform, we delivered solid portfolio performance alongside continued client growth across key markets, with particularly strong momentum in Pakistan and East Africa.

Portfolio quality remains robust and among the best in the industry, reflecting the effectiveness of our risk management and long-standing client relationships.

We also made decisive progress in reshaping and simplifying the Group, while advancing our digital agenda with the successful rollout of our new core banking system and digital financial services platform in Tanzania.

These actions strengthen our foundation for sustainable growth, enhance operational resilience, and position us well to expand responsible financial access for millions of underserved female entrepreneurs."

The Equity

There are 100m shares in issue, with institutional investors holding a significant portion, roughly 56.79% of the equity.

Founder Dirk Brouwer, through various vehicles, holds 19.30% of the group’s stock.

The larger holders include Catalyst Microfinance Investment Co. (20.13%), Conifer Capital Management LLC (19.53%), and APG Asset Management NV (18.67%), Phoenician Capital LLC (10.10%), RWC Asset Management LLP (4.12%), Renta 4 Gestora SGIIC SA (3.37%), and Rob Keijsers, CEO (0.75%).

Analyst Views

At Investec Bank, its trio of analysts - Nidhesh Jain, Uday Pai and Prithviraj Patil – rate the group’s shares as a Buy, with a 356p a share Target Price.

For the current year they are estimating that income will be $327.2m, with $141.7m of pre-tax profits generating earnings of 74.0c per share and paying out a dividend of 11.0c.

For the year to end-December 2027, the analysts look for $387.0m income, $161.6m profits, 88.9c of earnings and a 13.2c per share dividend.

At Cavendish Capital Markets, analysts Rahim Karim and Jens Ehrenberg have a Buy note on the stock, with a very solid 370p Target Price.

For the current year to end-December, they are going for revenues of $315.7m ($260.1m), while pre-tax profits could rise to $129.7m ($103.9m), elevating earnings to 54.1p (42.8p) and paying out a dividend of 13.5p (10.9p) per share.

For 2027, the analysts look for $351.8m revenues, $147.5m profits, with earnings of 61.5p and a payment of 15.4p in dividend.

The 2028 year could see $402.3m in revenues, with $173.3m profits, 72.2p earnings and a dividend of 18.1p per share.

Analysts Hugo Cruz and Ben Maher, at Keefe, Bruyette & Woods (Stifel) have a Target Price on the shares at 290p, expecting them to Outperform.

My View

This fairly unique group is massively undervalued at the current 264p, based upon analyst estimates, they could so easily double in price and still be an attractive purchase, whilst 350p looks an easy price objective.

(Profile 09.09.24 @ 87p set a Target Price of 130.50p*)

(Profile 23.10.24 @ 67.50p set a Target Price of 102p*)

(Profile 10.12.24 @ 70p set a Target Price of 105p*)

(Profile 08.12.25 @ 192p set a Target Price of 240p*)

(Profile 28.07.26 @ 264p set a Target Price of 350p)