ASA International – tomorrow’s Q3 Trading Update could get these shares, now 254p, heading back up to break through 300p soon
Mark Watson-Mitchell – 28.10.2026
Tomorrow morning, the unique micro-finance group ASA International (LON:ASAI) will issue its Third Quarter Trading Update.
I expect it to be positive in tone and again help to identify the Group’s shares as being undervalued.
Last night the £250m-capitalised Group’s shares closed at 254p, having been up to 297p in early July this year.
City analysts have Target Prices of up to 370p, which looks cheap to me.
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 regions of the developing world, especially in rural areas.
The £249m-capitalised ASA International, which is one of the world's largest international microfinance institutions, continues to operate across four main regions comprising 13 countries: East Africa comprises operations in five countries: Tanzania, Kenya, Uganda, Rwanda and Zambia; West Africa comprises operations in three countries: Ghana, Nigeria, and Sierra Leone; Southeast Asia comprises operations in two countries: the Philippines and Myanmar; and South Asia comprises operations in three countries: Pakistan, India and Sri Lanka.
It has a proven, low-risk operating model ensuring that the loan portfolio is achieved without compromising portfolio quality,
The Group's number of branches decreased to 2,124 as at end-June from 2,232 as at end-June 2025, primarily reflecting the ongoing wind-down in India.
However, client numbers grew 6% year-on-year, driven by sustained demand for credit across the Group’s markets.
Recent Results
On Wednesday, 9th September, the Group reported strong first-half 2026 results with a 70% increase in reported net profit to $45.6m and a 42% rise in underlying net profit to $34.3m.
The gross outstanding loan portfolio grew by 12% year-on-year to $603.9m, driven by Pakistan, Uganda, and Kenya, while maintaining an industry-leading portfolio quality with PAR>30 at 2.4%.
Total equity increased by 41% to $192.6m, and the company declared an interim dividend of $0.069 per share, a 43% increase year-on-year.
The outlook for the remainder of 2026 was noted as positive, with underlying net profit expected to be in line with or slightly ahead of market consensus.
Management Comment
On that announcement, CEO Rob Keijsers stated that:
"We are pleased with the continued progress delivered across the Group during the first half of 2026.
The continued trust and commitment of our clients, combined with the strength of our operating model and disciplined execution of our strategy, have enabled ASA International to deliver resilient portfolio growth alongside strong profitability.
These results are also a reflection of the strength and commitment of our teams across our various operating markets and the continued trust of our 2.7m clients.
This strong performance supports our positive expectations for the second half of 2026 and has meant that we can continue to provide capital returns to our shareholders.
These results mark a continuation in the growth of ASA International's profitability, reflecting a disciplined operating model that prioritises portfolio quality and sustainable returns over the pace of expansion.
We are encouraged by the momentum seen across a number of key markets, combined with our industry-leading portfolio quality, continued progress in our digital transformation and the further reduction of our exposure to India.
With a strengthened capital position, we are well placed to fund the next phase of growth, while maintaining the same disciplined, measured approach that has underpinned our performance.
We believe ASA International is well positioned to execute on its strategy and deliver sustainable, high-quality growth for the benefit of our shareholders, clients and lenders alike.''
While CFO Geert Embrechts stated that:
"ASA International delivered a strong financial performance in H1 2026, with continued growth across key financial metrics.
The performance reflects the strength of the Group's core operating model, resilient portfolio growth and continued focus on building a sustainable business.
The Group's financial position was further strengthened during the period, supported by strong profitability and a robust equity base.
Ghana and Pakistan remained the principal contributors to profitability, while Uganda and Kenya also made strong positive contributions.
Underlying net profit in H1 2026 grew by 42% to USD 34.3m when excluding India-related one-offs.
Reported net profit in the period grew by 70% to USD 45.6m.
The resilience of the ASA model was demonstrated during the first half, with the Group continuing to grow despite currency headwinds in a number of markets, most significantly the Ghanaian cedi.
These FX movements resulted in a negative USD 5.7m impact on the foreign currency translation reserve.
Alongside the higher profitability shown by the business in H1, there was also an improving cost income ratio which reduced to 55.6%.
The cost base increase seen in the first half of the year was due to personnel and office costs associated with business growth, as well as transportation costs.
The Group remains focused on improving operational efficiency and productivity, with further progress expected by year end.''
Broker Views
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.
My View
Hopefully tomorrow morning’s Q3 Update will be positive enough to get the shares running higher again.
Having been up to 297p recently, the shares now at 254p look incredibly undervalued and very capable of a significant price rise in due course.
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