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Indian Bank has reported 41%
growth in net profit at Rs 1708.83 crore for the quarter ended June 2023
(Q1FY2024). The bank has posted healthy 26% growth in net interest income
(NII), while the core fee income of the bank also improved 7% in Q1FY2024. The
Net Interest Margin (NIM) of the bank improved to 3.61% in Q1FY2024 compared to
3.10% in the corresponding quarter of previous year.
On business front, the bank as has posted 9%
growth in business with strong 13% surge in loan book. The asset quality of the
bank was stable in Q1FY2024. Bank has substantially improved the credit to
deposit ratio to 77.1% at end June 2023 from 72.8% at end June 2022. The CASA
ratio of the bank was stable at 40.3% at end June 2023 from 40.7% at end June
2022.
Asset quality improves: The bank has continued to improve asset quality
in Q1FY2024.
The fresh slippages of loans stood at Rs 1852
crore in Q1FY2024 compared with 2566 crore in previous quarter and Rs 3089
crore in the corresponding quarter last year.
The recoveries of NPAs stood at Rs 1079 crore,
upgradations at Rs 587 crore and the write-off of loans was at Rs 2139 crore in
Q1FY2024.
The standard restructured loan book of the bank
stood at Rs 7744 crore end June 2023.
Provision coverage ratio was steady at 95.10% at
end June 2023 compared to 93.82% a quarter ago and 88.08% a year ago.
The capital adequacy ratio of the bank stood at
15.8% with Tier I ratio at 12.9% at end June 2023.
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Asset Quality
Indicators: Indian Bank
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Jun-23
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Mar-23
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Dec-22
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Sep-22
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Jun-22
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Variation
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QoQ
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YoY
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Gross NPA (Rs Crore)
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26226.92
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28179.53
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29483.91
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31958.83
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34573.34
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-7
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-24
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Net NPA (Rs Crore)
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3197.55
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4043.07
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4270.48
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6174.13
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8470.72
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-21
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-62
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% Gross NPA
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5.47
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5.95
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6.53
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7.30
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8.13
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-48
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-266
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% Net NPA
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0.70
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0.90
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1.00
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1.50
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2.12
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-20
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-142
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% PCR
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95.10
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93.82
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93.59
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91.08
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88.08
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128
|
702
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% CRAR - Basel III
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15.78
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16.49
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15.74
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16.15
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16.51
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-71
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-73
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% CRAR - Tier I -
Basel III
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12.88
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13.48
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12.58
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12.89
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13.17
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-60
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-29
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Variation in basis
points for figures given in percentages and in % for figures in Rs crore
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Business Highlights:
Healthy business growth: The business of the bank has increased 9% YoY to
Rs 1100943 crore end June 2023, driven by 13% surge in advances to Rs 479404
crore. Deposits rose 6% to Rs 621539 crore at end June 2023.
CASA deposits ratio declines: The CASA deposits of the bank rose 5% YoY to Rs
250242 crore at end June 2023. The current account deposits increased 1% to Rs
32856 crore, while saving account deposits increased 6% to Rs 217386 crore end
June 2023. The CASA ratio declined to 40.3% at end June 2023 compared to 40.7%
at end June 2022, while declined from 42.0% a quarter ago. The term deposits
have increased 4% to Rs 371297 crore end June 2023.
Strong loan growth: Advances growth was driven by retail loans
rising 16% YoY to Rs 93215 crore at end June 2023, while credit to agriculture
increased 16% to Rs 104710 crore and MSME 7% to Rs 78510 crore at end June
2023. The corporate credit has moved up 12% to Rs 174199 crore end June 2023.
The overseas credit has jumped 11% to Rs 28770 crore end June 2023.
Investment
book of the bank rose 3% YoY
to Rs 190952 crore at end June 2023. The AFS book dipped -6% to Rs 49758 crore,
while HTM book rose 7% to Rs 141062 crore at end June 2023. The duration of the
AFS investment portfolio stood at 2.88 years end June 2023 compared with 1.91
years at end June 2022.
Margins improve: The bank has showed sharp 92 bps YoY jump in
cost of deposits to 4.75%, while yield on advances galloped 137 bps YoY to
8.53% in Q1FY2024. Thus, the NIM has improved 51 bps YoY to 3.61% .
Branch expansion: The bank has added 11 branches and reduced -125
ATMs in Q1FY2024, taking overall tally to 5798 branches and 4804 ATM`s end June
2023.
Book value of the bank stood at Rs 349.9 per share at end June 2023, while
the adjusted book value (net of NNPA and 25% of restructured advances) was Rs
308.7 per share at end June 2023.
Quarterly Performance
NII rises as NIM improves: Bank has recorded 29% increase in the interest
earned at Rs 13049.41 crore, while interest expenses increased 31% to Rs
7345.90 crore in Q1FY2024. NII improved 26% to Rs 5703.51 crore in the quarter
ended June 2023.
Moderate growth in core fee income, treasury
income rebounds: Bank has posted 7%
growth in core fee income to Rs 671 crore, while the treasury income rebounded to
Rs 464 crore, leading to 7% rise in the overall non-interest income to Rs
1709.58 crore in the quarter ended June 2023. On the other hand recoveries and
other income declined 42% to Rs 197 crore and forex income 45% to Rs 198 crore.
Expenses ratio rises: The operating expenses of the bank increased 27%
to Rs 3278.44 crore, as other expenses moved up 12% to Rs 1159.85 crore, while
employee expenses jumped 38% to Rs 2118.59 crore in Q1FY2024. Cost to income
ratio increased to 44.2% in Q1FY2024 compared with 41.9% in Q1FY2023, helping
the Operating Profit to increase 16% to Rs 4134.65 crore.
Provisions and contingencies decline: The bank has showed -22% decline in provisions
to Rs 1740.64 crore. The loan loss provisions declined -54% to Rs 930 crore.
However, the bank has written back investment provisions of Rs 26 crore, while standard
asset provisions rebounded to Rs 828 crore. the other provisions fell 74% to Rs
9 crore.
Effective tax rate jumped to 28.6% in Q1FY2024 from 9.8% in Q1FY2023. Net
Profit increased 41% YoY to Rs 1708.83 crore during quarter ended June 2023.
Financial Performance FY2023:
Bank has posted 34% increase in net profit to Rs 5281.70 crore in
the year ended March 2023 (FY2023). The net interest income increased 21% to Rs
20225.46 crore, while non-interest income moved up 3% to Rs 7143.06 crore, pushing
up net total income by 16% to Rs 27368.52 crore in FY2023. The operating
expenses increased 11% to Rs 12097.90 crore, while provision and contingencies fell
2% to Rs 9356.21 crore, allowing profit before tax to increase 85% to Rs 5914.41
crore in FY2023. The cost-to-income ratio improved to 44.2% in FY2023 compared
to 46.2% in FY2022. An effective tax rate increased to 10.7% in FY2023 compared
to negative 23.1% in FY2022. The net profit has increased 34% to Rs 5281.70 crore
in FY2023.
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Indian Bank: Results
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Particulars
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2306 (3)
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2206 (3)
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Var %
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2303 (12)
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2203 (12)
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Var %
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Interest Earned
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13049.41
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10153.66
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29
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44942.21
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38856.22
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16
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Interest Expended
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7345.90
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5619.68
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31
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24716.75
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22128.27
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12
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Net Interest Income
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5703.51
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4533.98
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26
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20225.46
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16727.95
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21
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Other Income
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1709.58
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1604.63
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7
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7143.06
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6915.45
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3
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Net Total Income
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7413.09
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6138.61
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21
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27368.52
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23643.40
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16
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Operating Expenses
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3278.44
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2574.23
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27
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12097.90
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10926.50
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11
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Operating Profits
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4134.65
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3564.38
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16
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15270.62
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12716.90
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20
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Provisions &
Contingencies
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1740.64
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2218.93
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-22
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9356.21
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9512.67
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-2
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Profit Before Tax
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2394.01
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1345.45
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78
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5914.41
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3204.23
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85
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Provision for tax
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685.18
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132.01
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419
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632.71
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-740.59
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PL
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PAT
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1708.83
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1213.44
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41
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5281.70
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3944.82
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34
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EPS*(Rs)
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54.9
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39.0
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42.4
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31.7
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Adj BV (Rs)
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308.7
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209.5
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281.1
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193.1
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* Annualized on current equity of
Rs 1245.44 crore. Face Value: Rs 10, Figures in Rs crore
PL: Profit to loss, LP: Loss to
Profit
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Source: Capitaline Corporate
Database
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