Accumulate South Indian Bank - 3QFY2013 Result Update - Angel Broking

South Indian Bank (CMP: Rs.29 / TP: Rs.33 / Upside: 14%)

During 3QFY2013, South Indian Bank reported 25.4% growth in net profit to Rs.128cr. On the operating profit level, growth was even stronger at 31.5% yoy. Key highlights from the results were sequential improvement in the asset quality and the NIMs.

The bank reported healthy growth in its business, with advances witnessing a growth of 17.5% yoy, while deposits registering a growth of 15.1% yoy. On the asset quality front, the bank witnessed improvement, with gross and net NPA levels coming down sequentially by 4.3% and 18.7%, respectively. Gross and Net NPA ratios came in lower sequentially by 12bp and 18bp, respectively to 1.6% and 0.7%. The bank's PCR improved by 735bp to 58.6%.

At CMP, the stock trades at 1.2x FY2014E ABV. We maintain an Accumulate recommendation on the stock, with a target price of Rs.33.

Source : Equity Bulls

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