Karnataka Bank Ltd. share price target

Karnataka Bank (KBL) second quarter performance was muted. Weaker NII growth and higher credit costs led to disappointing bottomline performance, down 5% YoY to Rs 106cr. Credit costs was up from 1.5% to 1.9% QoQ.

Karnataka Bank (KBL) reported soft operating performance with profitability supported by tax reversal. NII was muted at 3/6% QoQ/YoY on NIM pressure (2.8%) and loan growth slowdown on account of run-down in large corporate segment. Non Interest income was largely aided by treasury income.

Loan growth momentum sustained at 17% YoY led by large corporate segment. However, NIM pressure due to interest income reversal restricted NII growth at 8% YoY. C-I moved up on higher staff costs consisting of largely one-offs. GNPAs improved to 4.45% sequentially from 4.66%.

KBL reported a mixed performance for Q2FY19. NIM pressure, increase in slippages were disappointing, but strong loan growth with increasing share of high rate portfolio and reduction in stressed asset portfolio is comforting. NII growth was muted at 6% YoY even as loans grew 22%.

Karnataka Bank Ltd Q2FY19 profitability has substantially improved YoY. It has reported PAT of Rs 112 cr. in Q2FY19 vs Rs. 93 cr. in the corresponding quarter of last fiscal year. On a QoQ basis, the net profit fell by 32%. Operating profit of the bank...

We retain Buy on Karnataka Bank (KBL) with TP at Rs160. Q2'19 results were a mixed bag. While lower than expected margins, higher slippages were a few negatives; we draw greater comfort in strong loan growth with increasing share of high rated portfolio, continued traction in fee income and further reduction in stressed asset portfolio. We remain convinced on the KBL transformation journey and believe that valuations at 0.6x...

Karnataka Bank Ltd. (KBL) reported mixed set of numbers for Q1FY19 with strong growth in business and profitability and muted performance on margin front. While, the bank posted 22.0% YoY growth in net profit on the back of low provisioning for NPAs and controlled apex, NIM reduced by 18 bps QoQ to 3.0% and also reported sluggish performance on other income and CASA accretion fronts. Meanwhile advances continue to show strong traction growing by 24% YoY and slippage ratio reduced to 0.6%. Owing to the lower slippage of Rs2,700 mn, GNPA ratio reduced by 21bps QoQ to 4.72% and NNPA stood at 2.92%. Business growth is expected to...

Karnataka Bank (KBL) clocked in decent profitability in Q1FY19 on back of improved opex and reduction in slippages (2.3% vs 9% QoQ). PAT improved from Rs 11cr to Rs 130cr QoQ. Loan growth sustained and grew 24% led by corporate segment.