DCB Bank Ltd. share price target

The Management focuses on increasing loan book in low-ticket retail, SME & AIB segments and augmenting its footprint both on physical and digital front. Though this aggressive strategy of expanding footprints will marginally impact its return ratios in the near-term, it would bring forth substantial positive benefits in the long-term. Further, the Management focuses on increasing efficiency of existing network to improve cost to income ratio in the long-term, which will lead to sustained earnings growth, in our view. We expect further improvement in Bank's performance due to rollout of GST, as creditworthiness of its core client group from SME/MSME segment will improve substantially. We reiterate our BUY recommendation on the stock with an...

The Management focuses on increasing loan book in low-ticket retail, SME & AIB segments and augmenting its footprint both on physical and digital front. Though this aggressive strategy of expanding footprints will marginally impact its return ratios in the near-term, it would bring forth substantial positive benefits in the long-term. Further, the Management focuses on increasing efficiency of existing network to improve cost to income ratio in the long-term, which will lead to sustained earnings growth, in our view. We expect further improvement in Bank's performance due to rollout of GST, as creditworthiness of its core client group from SME/MSME segment will improve substantially. We reiterate our BUY recommendation on the stock with an...

Maintain BUY with a TP of Rs 214 (2.3x Sept-19 ABV of Rs 93). Maintain BUY with a TP of Rs 214 (2.3x Sept-19 ABV of Rs 93). DCBBs results seem erratic, as the one-off in 1Q (higher fees and treasury gains) blemished performance (albeit optically). The banks focus on core earnings is visible, as NII grew sequentially for the 13th straight quarter, driven by superior NIMs (~4.2%). Normalising for 1Q, non-interest income was stable sequentially (+6% YoY).

falling CI ratio (60.3%, +300bp QoQ) trend of past few quarters. Provisions at INR302m (+14% YoY, 4% miss) led to PAT growth of 21% YoY (7% miss). Loan book grew 7%/21% QoQ/YoY to INR173b, led by strong growth in AIB (+21% YoY), MSME (+31% YoY) and corporate book (+28% YoY), while other categories such as CV/CE (+51% YoY) and gold (+21% YoY) also showed strong growth. Corporate book inched up to 17% of loans. Absolute GNPA/NNPA grew to INR3.2b/INR1.6b (+11%/+5% QoQ), driven by 16%/10% sequential growth in mortgage/AIB GNPA (INR1.16b/INR561m)....

DCB Bank's Q2FY18 performance was muted due to lower-thanexpected business growth and lower other income PAT came in at | 59 crore, lower than estimate of | 62.6 crore, led by subdued other income and higher opex Advance growth, though it continued to remain above system growth, came in a tad lower at 20.5% YoY to | 17395 crore, led by moderation in the mortgage book Led by margin expansion of 26 bps YoY and | 7 crore of income tax refund, NII growth remained healthy at 30.8% YoY. However, muted...

We have tweaked our estimates to factor in superior NIM, healthy non-interest income and higher NPAs. With near completion of branch expansion, recent fund raise and traction in core fees, the oplev is expected to improve hereon (key to RoAA improvement). Healthy business traction, no major asset quality woes and a conservative management are key virtues. Maintain a BUY with a TP of Rs 222 (2.5xFY19E ABV of Rs 89) DCB Banks (DCBB) 1Q earnings optically beat estimates, driven by higher treasury gains (Rs 287mn). Even ex-treasury, the quality of earnings was superior led by sustained credit growth (+22%), superior NIM (4.23%, supported by fund raise), CASA ratio (~26.9%) at a 16-qtr high with 40% SA growth and healthy fee income (+15% QoQ, in a seasonally weak quarter).

Healthy Core Operating Performance on Key Metrics; Maintain BUY DCB Bank has posted a higher-than-estimated net earnings in 1QFY18 on the back of 19bps QoQ rise in NIMs to an all-time high of 4.23%, higher treasury gain of Rs287mn (vs. Rs41mn in 4QFY17) and 14.8% QoQ rise in core fee. On the other hand, fresh slippages increased sequentially to Rs887mn vs. Rs742mn in 4QFY17 led by higher slippages in LAP, AIB and gold loan portfolio. As a result, provisioning expenses rose by 72.9% YoY and 4.6% QoQ to Rs355mn. The Bank's net profit grew by 38.7% YoY and 23.4% QoQ to Rs652mn owing to strong growth in operating revenue, which offset higher provisioning and operating expenses. We reiterate our...

Background: DCB Bank Limited (formerly Development Credit Bank Limited) is the smallest listed private sector lender. DCB has a deposit base of INR 192bn and advances of INR163bn at the end 1QFY18, making it the smallest bank in the listed private sector space, including both new and old generation private sector banks. Promoter group the Aga Khan Fund for Economic Development (AKFED) & Platinum Jubilee Investments holds ~15.02% stake. DCB services entails Corporate Banking - 15%, SME -11%, Agriculture 17%, Mortgages 44%. As on 1QFY18, the bank has a...

ICICI Securities Ltd | Retail Equity Research DCB Bank reported a healthy core operational performance in Q1FY18 with PAT at | 65 crore, above our estimate of | 60 crore Advance growth continued to remain strong at 22% YoY to | 16265 crore, led by traction in the mortgages book. Deposit growth continued to remain healthy at 22% YoY, led by CASA accretion NII growth continued to stay healthy at 31.7% YoY, led by capital raising and ~18 bps YoY improvement in margin. Robust treasury...