Indian Bank

This Bank, surprisingly, posted a good performance, both on the profitability as well as asset quality front. Also YoY, last fiscal, was very bad for the bank thus the lower base effect will also have a play. Its net profit for Q4FY17 rose 240% or by 3.4 times to Rs.320 crore. This was thanks to the 22% rise in NII at Rs.1385 crore while its other income or the non-interest income was up 9% at Rs.585 crore. Operating profit was up 28% at Rs.1070 crore.

In terms of asset quality, Gross NPA declined 22 bps (QoQ) to 7.47% while Net NPA fell 37 bps to 4.39%. Provisions rose 49% sequentially but was down 0.8% YoY at Rs.807 crore.  Non-performing loan provision coverage ratio improved at 58.14% v/s 56.5% (QoQ).  The bank has set itself a target of bringing down the Gross NPA to less than 5% and Net NPA by less than 3% in current, FY18 fiscal.

The Bank is planning of a Follow-on public offer or FPO in current fiscal to raise around Rs.1000 to 1500 crore before end of Oct. Govt of India presently holds 82% stake and it hopes to bring it down to 75%.