RBL Bank Ltd. share price target

The bank is planning to expand its MFI portfolio from the current nineteen states by adding two-to-three more states in the coming months, (b) Incremental growth is due to new customer addition (22% of its customers are new to credit), rather than an increase in the average ticket size. This is evident from the average ticket size, which currently stands at INR27K (nearly stable for large few years) whereas the maximum ticket size is capped at INR40K, (c) RBL Bank has deployed ~400 employees to man the BC branches to ensure proper checks and balances at the time of disbursing the MFI loans, (d) Management has guided MFI portfolio mix to improve to ~13%-15% (from current 9% levels) and (e) Management is building in ~1.5% credit cost in its MFI portfolio and is expected to build some contingent provisions (going forward) to counter event specific risks.

RBL Bank's asset quality continues to remain stable as Gross non-performing asset (NPA) ratio stood flat sequential at 1.4% and Net NPA ratio declined marginally by 1 bp QoQ to 0.7%. Provision coverage ratio (PCR) improved further by 104 bps QoQ to 61.5% on the back of higher provisions. Notably, as per the management the bank's exposure to IL&FS; group is just ~Rs15cr (0.03% of loan book) in the form of a corporate guarantee secured with 100% cash collateral. Further, exposure to NBFC and real estate is largely towards better-rated companies where the management indicated that the risk of default is quite low. We expect asset quality to continue to show broadly stable trend (Gross/Net NPA ratios of 1.5%/0.8% by FY20E) given the bank's...

Maintain BUY with TP of 618 (3xSept-20E ABV of Rs 206). RBKs 2Q was impressive with industry leading broad based growth (37%), strong fee traction (+61%), 7th consecutive qtr of sequential NIM (4.08%) improvement and stable asset quality (net stressed book at a mere 80bps). The sustained NIM uptick was on account of MCLR reset and increase in the share of the high yielding retail portfolio.

23 October 2018 RBL Bank Loan growth of 36.6% YoY was led by both non-wholesale (42.5% YoY) and wholesale (32.8% YoY) taking retail book share to 40.9% from 39.2% a year ago. Within the non-wholesale book, DB&FI; segment grew 37% YoY while retail book grew by 45.3%. Wholesale loans grew 32.8% YoY (8.6% QoQ), led by 35.5% YoY (9.8% QoQ) growth in the C&IB; segment and 27.2%YoY (5.9% QoQ) growth in the CB segment.

RBL Bank Ltd (RBL) is one of India's fastest growing private sector banks with an expanding presence across the country. The Bank offers specialized services under six business verticals namely: Corporate & Institutional Banking, Commercial Banking, Branch & Business Banking, Agri Business Banking, Development Banking and Financial Inclusion, Treasury & Financial Markets Operations. In the past five years, the bank has focused on building a comprehensive product suite, improving risk management, upgrading technology by implementing a new-age core banking system platform and expanding its distribution network. It currently services over 4.90 mn customers through a network of 266 Branches,...

23 August 2018 The credit card market in India is highly underpenetrated (2.3% of population as at FY17) in comparison to other countries like USA (300%), Korea (180%) and Brazil (70%). Moreover, credit card spends of USA, Korea and Brazil is significantly higher than India at 60x, 10x, and 4x, respectively. The increasing focus on digitalization, shift towards a cashless economy and increasing awareness is expected to drive and strengthen growth in the credit card segment over the medium term. We expect this pace to continue with MFI book growing at ~40% CAGR while credit card segment grows at ~60% CAGR over FY18-21E. RBLs share in the outstanding number of cards increased from a mere 0.9% in March 2017 to 2.1% in March 2018, and it currently ranks amongst the top 10 credit card players. With access to BAFs customer base (26.22m), strong focus and superior product proposition, we expect RBL to continue its dominance in gaining market share.

RBL Bank Ltd. (RBL) formerly known as Ratnakar Bank Ltd. is a Scheduled Commercial Bank (SCB) which came into operations in 1943 and was incorporated as a small, regional bank in Maharashtra with two branches in Kohlapur and Sangli. Presently, it is one of India's fastest growing private sector banks and offers a comprehensive range of banking products and services which are mainly categorized in five sectors: Corporate & Institutional Banking, Commercial...

RBL Bank is Indias fastest growing private sector bank (~59% loan CAGR over

Maintain BUY with a TP of Rs 584 (3x Mar-20E ABV of Rs 195). It was a quarter full of positives for RBK with robust loan growth (+36% YoY), steady asset quality (GNPAs flat at 1.7%) and superlative fee traction (+59% YoY), owing to cards. The steady uptrend in retail yields (+110bps YoY) drove up NIM to 4.04% (+50bps YoY), despite the continued pressure on corporate yields (-70bps YoY).

Background: RBL bank (RBL) came into operations in 1943 and was incorporated as a small, regional bank in Maharashtra with two branches in Kohlapur and Sangli. Post the change in the management team in 2010, it has been one among the fastest growing private sector banks and now has 266 interconnected branches and 369 interconnected ATMs spread across 20 Indian states and union territories serving ~4.91mn customers. The bank offers a comprehensive range of banking products and services customized to cater to the needs of large corporations, SMEs, agricultural customers, retail customers and development banking & financial inclusion (low income)...