Canara Bank share price target

NII fell to Rs. 2413.8 Cr in Q3FY17 compared to Rs. 2442.35 Cr in Q2FY17. NII rose by 8.41% ( Rs. 187.2 Cr ) when compared with the same period last year.

Despite tough scenario, Canara Bank has delivered an inspiring performance on key asset quality parameters in 3QFY17. Slippages dipped to Rs22.3bn in 3QFY17 vs. Rs24.5bn & Rs38.8bn in 2QFY17 & in 1QFY17, respectively. Total gross NPAs and standard restructured loan declined to 13.6% of loan vs. 13.9% in 1QFY17. Further, its PCR improved to 52.5% in 3QFY17 from 50.8% in 1QFY17. However, its operating profit dipped by 7.4% qoq to Rs19.8bn, while PAT declined by 9.8% qoq to Rs3.2bn. Subdued performing on operating front is attributable to reversal of Rs2bn of interest income on SDR loans due to change in income recognition guidelines by the RBI. As...

Credit growth for Canara Bank remained muted with flat negative growth of -0.9% yoy and -1.1% QoQ. Loan book was flattish due to a decline in corporate advances. The bank has also converted Rs 9000 crore of Discom loans to bonds during last two quarters leading to decline in infrastructure loan book. Retail advances backed by strong growth across sub-segments grew 34% YoY. On advances front, the bank is strongly focusing on growing retail advances (Agriculture, MSMEs, Housing & Other Retail Schemes)...

Given that the bank's performance on NII, asset quality and other income front is ahead of our FY17E forecasts; our forecasts have seen upward revisions. We are getting reasonably assured that bank will continue to deliver positive surprise on operating as well as assets quality front in coming quarter under the new board and management team. Hence, we have upgraded the stock to BUY from earlier HOLD rating with...

8 Performance at the operating level continued to remain weak due to negative credit growthandsubduedNIM,thiswasfurtheraccentuatedbycleaningupofbalancesheet leadingtohigherNPAprovisionsandresultinginlossofRs39bn....

Canara Bank has reported highest ever loss in its history in 4QFY16 with its new management fully recognising impairment and ensuing provisioning impact of asset reclassification in compliance with AQR by the RBI. Moreover, it has also fully provided for UDAY bonds/SEB exposure and loan to Punjab Govt. This has led to sharp rise in slippages to Rs146bn in 4Q (at slippage ratio of 17.6%) v/s Rs54bn (6.7%) in 3Q & Rs247bn (7.5%) in FY16 v/s Rs109bn (3.6%) in FY15. Further, provisioning expanses grew 527% yoy & 343% qoq to Rs63.3bn as the Bank provided for all AQR cases with additional provisioning on UDAY bond and...

ff The bank has total exposure of Rs180bn towards SEB's restructured loan out of which Rs120bn is covered under UDAY scheme. The bank will convert Rs60bn in state government bonds during 4QFY16E. Hence, NIM will be marginally...

Canara Bank's (CBK) reported 3QFY16 PAT of INR850m (-87% YoY, 77% below est.). Weak core PPoP growth (-27% YoY) and elevated credit costs (1.75% v/s 1.2% in 2Q) led to the miss. NIMs contracted sharply (down 27bp QoQ to 2%) impacted by...

In its 2QFY2016 results, Canara Bank reported a decline in PAT by 15.6% yoy, mainly due to higher provisions and surge in operating expenses. Loan book grows at a slow pace; NIM rises qoq During 2QFY2016, the banks loan book grew by 3.9% yoy with retail loan book growing at a faster pace at 14.3% yoy. The C-D ratio came down to 66.6% from 67.4% in 2QFY2015. Deposits growth was muted at 5.2% yoy with CASA deposits showing momentum, which grew by 11.5% yoy. As a result, the domestic CASA ratio for the bank rose by 178bp yoy to 25.5% as of 2QFY2016. The Reported Global NIM rose sequentially from 2.21% in 1QFY2016 to 2.24% in the current quarter which aided NII growth of 11.8% for the quarter. The Management expects to reach 2.35% NIM by the end of this fiscal year. During 2QFY2016, the non-interest income (excluding treasury) was subdued with a yoy growth of 4.4% yoy largely aided by recoveries from written off accounts. Treasury income, at Rs295cr, more than doubled for the quarter on a yoy basis (Rs144cr in 2QFY2015). On the asset quality front, slippages came at Rs2,202cr (annualized slippage rate of 2.7% as compared to...