Lakshmi Vilas Bank Ltd.(Amalgmated) share price target

Asset quality deteriorated with GNPA increasing sharply 731bps YoY (432bps QoQ) to 9.98% and NNPA increasing by 390bps YoY (139bps QoQ) to 5.66%. In absolute terms, GNPA increased by 88% QoQ to INR 26.9bn and NNPA increased by 37.5% QoQ to INR 14.6bn. The slippages are mainly on account of shifting of some of the restructured accounts to substandard status as well as normal slippages that have happened in the course of the year, which were almost entirely out of the watch list created by the bank. The bank's...

by 245bps YoY(-6bps QoQ) to 4.27%. In absolute terms, GNPA increased by 11.7% QoQ to INR 14.3bn and NNPA increased by 6.8% QoQ to INR 10.6bn. Surge in bad loans was driven by higher slippages of INR 2.9bn, in the quarter (top 3 accounts constitute ~INR 1.8bn).The bank had created a watch-list' in 1QFY18 comprising of ~40 big ticket size accounts(~25% from metals and ~15% from infrastructure industry), slippages were almost entirely...

Operating profit dropped to INR1.8bn (de-growth of 9.9% QoQ), which was largely driven by de-growth in other income. Total non-interest income is noted at INR 1.24bn witnessing a decline of 21.2% QoQ (- 6.1% YoY). Fee based income which stood 51% of other income, is expected to be sustainable over the coming quarters....

Operating profit stood at INR1.99bn (growth of 58% YoY) which was largely driven by Cost/income improved significantly to 46.9% vs. 52.8% in 1QFY17. PAT grew marginally by 9%YoY to INR 661mn dragged by higher provisioning cost (219% YoY)....

Q4FY17 PAT was almost flat at +6% YoY, missing the estimates due to 4x YoY rise in provisions. NII growth (+32% YoY) was healthy and NIM expanded ~38 bps QoQ to 3.1% on improved LDR (up 7.4 ppts QoQ to 78%).

Deposits grew (15.9%YoY, 4%QoQ) to INR 277.5bn in 3QFY17 supported by growth of CASA by 49.8%YoY due to the impact of demonetization. The current CASA ratio stands at 21.4% as against 17.3% at 2QFY17. Credit to Deposit ratio currently stands at 71% as...

Lakshmi Vilas Bank (LVB) is a south based private sector bank with major business (50.2%) concentrated in the state of Tamil Nadu. As of FY16, LVB has a network of 460 branches and 910 ATMs, with business size of Rs45,250cr. LVB has beefed up teams with lateral hiring from banks & NBFCs and implemented innovative large scale technolog..

Fresh slippages were noted at 622mn; with recoveries for the quarter amounting to 108mn. There was no implementation of any 5:25 scheme on any accounts for the quarter, although the outstanding balance under 5:25 scheme stood at INR 1.2bn and under SDR scheme stood at INR 480mn. During the quarter, no sale was made to ARCs. GNPA & restructured advances has...

Fresh slippages were noted at 1.12b n (Largely due to three large accounts out of which two were restructured accounts that slipped into NPA - one metal and one steel); with recoveries for the quarter amounting to 140mn. Management indicated that a spike in write off (amounting to INR 680mn) was only a prudential write off for the purpose of tax benefit. There was no implementation...

Background: Lakshmi Vilas Bank Limited is old-gen private bank with total business of INR 421bn; predominant focus on Retail 27%, SME 20% , and Wholesale 39% and Agri 14% lending in South India especially in the state of Tamil Nadu. LVB's network entails 439 branches with 820+ ATMs & 3300+ employees. Deposits are largely retail dominated comprising Retail TD 75% & CASA ...

Background: Lakshmi Vilas Bank Limited is old-gen private bank with total business of INR 349bn; predominant focus on Retail 27%, SME 20% , and Wholesale 38% and Agri 15% lending in South India especially in the state of Tamil Nadu. LVB's network entails 400 branches with 820+ ATMs & 3300+ employees. Deposits are largely retail dominated comprising Retail TD 75% & CASA ...

Background: Lakshmi Vilas Bank Limited is old-gen private bank with total business of INR 339bn; predominant focus on Retail 29%, SME 32% , and Wholesale 37% and Agri 16% lending in South India especially in the state of Tamil Nadu. LVB's network entails 400 branches with 820+ ATMs & 3300+ employees. Deposits are largely retail dominated comprising Retail TD 75% & CASA ...

Background: Lakshmi Vilas Bank Limited is old-gen private bank with total business of INR 339bn; predominant focus on Retail 29%, SME 32% , and Wholesale 37% and Agri 16% lending in South India especially in the state of Tamil Nadu. LVB's network entails 400 branches with 820+ ATMs & 3300+ employees. Deposits are largely retail dominated comprising Retail TD 75% & CASA ...

Background: Lakshmi Vilas Bank Limited is old-gen private bank with total business of INR 339bn; predominant focus on Retail 32%, SME 20% , and Wholesale 31% and Agri 17% lending in South India especially in the state of Tamil Nadu. LVB's network entails 374 branches with 690+ ATMs & 3292 employees. Deposits are largely retail dominated comprising Retail TD 75% & CASA 15%,...

Background: Lakshmi Vilas Bank Limited is old-gen private bank with total business of INR 321bn; predominant focus on Retail 32.3%, SME 19.7% , and Wholesale 29.6% and Agri 18.4% lending in South India especially in the state of Tamil Nadu. LVB's network entails 361 branches with 688+ ATMs & 3292 employees. Deposits are largely retail dominated comprising Retail TD 75% & CASA 15.4%, with working capital focused loan book (~70%) augurs well for re-pricing of loans across interest rate cycles as a similar maturity...