Credit Cost to Remain Elevated in the Medium-term; Maintain HOLD Canara Bank has reported a higher-than-expected bottom-line growth in 3QFY18 led by onetime interest income from IT refund (Rs7.4bn) and higher cash recovery of Rs15.3bn vs. Rs10.2bn in 3QFY17. As a result, its net profit stood at Rs1.3bn (-60.9% YoY & -51.7% QoQ) vs. our estimates of Rs4.2bn net loss. However, from asset quality perspective, the Bank demonstrated sustained improvement with fresh slippages declining to the lowest level of Rs26.4bn in last one year. Further, its impaired loan portion also declined to 12.2% in Dec'17 from 12.7% and 13.6% in 2QFY18 and 3QFY17, respectively. Loan book grew by 4.1% QoQ and 12.5% YoY to Rs3,731bn during the quarter. As the Bank consciously slowed down deposit growth to 1.5% QoQ and -1.3% YoY; its...