ASA International Group PLC (LSE: ASAI)

ASA International Group PLC (LSE: ASAI) is an FTSE listed microfinance company, which is based in the United Kingdom. It operates through 1,812 branches and employs 11,864 people. It has around 2,300,000 clients and manages a gross loan portfolio of around USD 419.5 million. The Group is active in 13 countries in Asia and Africa. This Report covers the Key Recommendation Rationale, Conclusion, and Recommendation on the stock.

Key Recommendation Rationale – Sell at GBX 162.00

• India Drag Remains a Headwind to Regional Growth - The continued contraction of the Indian business stands out in an otherwise decent growth narrative. Client numbers in India fell by 33% YoY and 16% QoQ, while the gross outstanding loan portfolio declined 40% YoY and 11% QoQ. Despite the planned divestment, this ongoing reduction offset growth momentum in other regions and could dilute operational leverage or scale benefits in South Asia until the exit is fully executed by year-end.
• Currency Movements Skewing Growth Optics - While Ghana's contribution to loan portfolio growth appears significant, a 33% appreciation in the Ghanaian cedi played a key role in boosting the USD-reported Gross OLP. This raises questions about the true underlying growth in local currency terms. For investors, this introduces an element of currency volatility risk, especially in frontier markets where exchange rate movements can exaggerate or understate financial performance.
• Mixed PAR Trends in Smaller and Frontier Markets - Despite the headline improvement in portfolio-at-risk (PAR>30) to 1.5%, certain markets still reflect elevated or fluctuating risk.

Valuation Methodology: Price/ Earnings Approach

Share Price Chart  

ASAI Daily Technical Chart, Source - Refinitiv

Conclusion

ASAI is expected to trade at a discount, considering India Drag Remains a Headwind to Regional Growth, and fears of global slowdown. For conducting the valuation, the following peers have been considered - S&U PLC (LSE: SUS), Ramsdens Holdings PLC (LSE: RFX) and others.

Given its current trading levels, Currency Movements Skewing Growth Optics, recent rally in the share price, relative valuation, and associated risks, it is prudent to exit the stock at the current levels. Hence, a ‘Sell’ recommendation is given on the stock at the current Market Price of GBX 162.00 as of 17 September 2025 at 11:13 AM GMT+1.

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 17 September 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level which the stock is expected to reach as per the relative valuation method and/or technical analysis taking into consideration both short-term and long-term scenario.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Note 6: Dividend Yield may vary as per the stock price movement.