Indian Bank share price target

Indian bank reported higher NIMs at 2.85% (15bps y-o-y & 12bps q-o-q) led by higher C/D ratio and improvement in spreads. PPOP grew by 37% y-o-y (10% q-o-q) largely due to controlled opex (3% y-o-y & q-o-q) and higher other income (22% y-o-y & 10% q-o-q). GNPA remained flat q-o-q to 96.2bn (6.7% vs. 7.2% in Q1 FY18) and higher provision (9% q-o-q)...

The Bank continues to remain the best-managed PSB on all major fronts. Analysis of its stressed assets clearly suggests that it is approaching the end of recognition of stressed loan cycle, which along with higher PCR clearly indicates sharp moderation in credit cost from FY19 onwards. Further, strong revival in loan growth along with improvement in NIMs and other income suggests continued improvement in operating profit, going forward. Hence, we expect healthy traction in earnings to continue owing to robust growth in loan book, moderate credit cost and healthy margins. We upgrade our recommendation on the stock to BUY from HOLD with a...

Sector: Banks /Mid-Cap | Earnings Update 2QFY18 Background: Indian Bank features among the mid-sized banks in the public sector space, as of 2QFY18 the bank had business of about INR 3.43tn. The Bank operates through a network of 2698 branches; Indian Bank's footprint is largely skewed towards the southern states of Tamil Nadu, Karnataka, Andhra Pradesh and Kerala. With...

C/I ratio moderated 160bp QoQ to 39.1%, led by control on both employee and other opex, while management guided for a further improvement in the C/I ratio to 35%-37% by FY19. PPoP growth thus stood at an impressive 37% YoY; however, high provisions and an elevated tax rate against last year's lower base dragged net earnings growth to 11% YoY. Fresh slippages declined 50% QoQ to INR3.56b. PCR improved by 500bp QoQ to 45.7% (65.4% including technical write-offs) on the back of higher provisions. During the quarter, the bank provided INR1.19b toward IBCrelated accounts (same amount needed for 3Q & 4Q), while it has total...

Indian Bank is a mid-sized PSU bank with close to 2687 branches. In four years until FY15, credit traction has been strong at 19% CAGR, way ahead of the industry, growing at 17.4% CAGR. However, owing to a slowdown in corporate credit demand, advances remained flattish in FY16-17. As on FY17, loans were at | 127699 crore, which are well diversified into corporate at 45% of domestic book and retail at ~55%. Going ahead, we FY19E expect a pick-up in credit growth. Therefore, we expect credit CAGR of...

NII grew to Rs. 1384.9 Cr in Q4FY17 compared to Rs. 1246.58 Cr in Q3FY17.

Indian Bank's gross advances showed a pick-up in growth with a sequential increase of 5% (-0.4%YoY) in 4QFY17 to INR 1.32tn. Domestic loan book grew sequentially by 4.7% to INR 1.26tn led by growth in Retail book (9.7% YoY, 10.1% QoQ). However, Corporate segment registered de-growth (10.5%YoY, 1.2%QoQ). Consequently, the domestic loan mix stood at...

PAT came in at | 319 crore, up 241% YoY, led by a lower base owing to higher slippages in Q4FY16. PPP came in at | 1070 crore (28% YoY), above our estimate, led by a higher-than-expected topline NII growth was healthy at 22.1% YoY to | 1385 crore, despite 1%...

Indian Bank has delivered a healthy operating performance in 4QFY17. Its operating profit surged by 29.3% YoY and 4.8% QoQ to Rs10.7bn led by strong growth in NII (22.1% YoY & 11.1% QoQ to Rs13.9bn) and relatively lower (7.6% YoY and 9.1% QoQ) opex at Rs9bn. However, provisioning expense increased by 49.3% QoQ to Rs8.1 bn due to higher Mark-to-Market (MTM) provisioning on non-HTM investment portfolio. Loan growth revived sequentially by 12.1% to Rs1,411bn led by strong growth retail and SME segment. Fresh slippages declined to Rs6.3bn in 4QFY17 compared to Rs9.3bn in 3QFY17 and Rs33.9bn in 4QFY16. Along with moderation in fresh slippages, standard restructured loan book also declined to 3.1% of loan book as against 4.72%...

ICICI Securities Ltd | Retail Equity Research PAT came in at | 373 crore, up 670% YoY, led by a lower base owing to higher slippages in Q3FY16. Though PPP came in at | 1021 crore (33% YoY), broadly in line with our estimate, the bottomline stayed above our estimate owing to lower tax outgo during the quarter NII growth was healthy at 12.2% YoY to | 1247 crore, despite flat credit growth YoY to | 125814 crore. Margins improved 21 bps YoY to 2.52%, though on a QoQ basis, decline of ~12 bps was witnessed...