Indian Bank Q3FY14 Result - First-Cut - Microsec

Indian Bank Ltd. announced its Q3FY14 result on 23rd January 2014.

The Bank's total income decreased by 2.73% QoQ and 3.64% YoY to INR1333.22 crores. Whereas, Profit After Tax (PAT) decreased by 13.49% QoQ and 19.99% YoY to INR264.52 crores. During the quarter, the Bank's tax expenses was INR129.83 crores as against INR5.88 crores same quarter last year, which has dragged its bottom line.

The Bank's loans book and total deposits expanded by 12.66% and 16.64% YoY to INR112241 and INR157558 crores respectively. On the asset quality front, the Bank has improved its asset quality which was the matter of concern for the Bank. Gross NPA and Net NPA decreased by 31 and 34bps QoQ to 3.42% and 2.25% respectively. Moreover, despite 10bps QoQ down in CASA ratio, the Bank has improved its Net Interest Margin by 2bps QoQ to 2.65%. The Bank is well capitalized to support its growth trajectory with 12.49% of its Basel III Capital Adequacy Ratio (CAR), which is 349bps higher than the regulator's stipulated norm.

Valuation

On the basis of Price/Book value, Indian Bank is trading at lower valuation. At the CMP of INR106.50, the stock is trading at TTM P/BV of 0.41x. We continue to have a positive view on the stock. However, below expected performance from the last few quarters may lead us to revise our target price downward for the stock.

Source : Equity Bulls

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