South Indian Bank - Q4FY13 Result Review - Angel Broking

South Indian Bank reported modest set of numbers for the quarter. While, NII grew at 17.3% yoy (went down by 5.4% qoq) to Rs. 334cr, non-interest income grew strongly by 46.6% yoy to Rs. 121cr (possibly due to higher treasury gains, as seen in other banks), thereby resulting in operating profit growth of 26% yoy to Rs. 206cr. On the asset quality front, on an absolute basis, while the Gross NPA levels came off by 9% qoq, the Net NPA levels were higher by 27% qoq, even as provisioning expenses came much higher than expectations. Due to higher-than-expected provisioning, earnings at PBT level declined by 7% yoy to Rs. 140cr, however, aided by tax write-backs (Rs. 14cr compared to an expense Rs. 29cr), the bank reported 26% yoy growth in the bottom-line to Rs. 154cr.

At the CMP, the stock is trading at 0.9x FY2015E ABV. We recommend a Neutral rating on the stock.

Source : Equity Bulls

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