Central Bank of India - 4QFY2013 Result Review - Angel Broking

Central Bank reported healthy set of numbers for the quarter, as it posted Net profit of Rs. 169cr as against a loss of Rs. 105cr in 4QFY2012 (the bank had completely switched-over to system based NPA recognition during that quarter, resulting in substantial provisioning). Key takeaways from the result were healthy NII growth (21.4% yoy, in-line with expectations), strong performance on the noninterest income front (growth of 47.4% yoy) and sequential improvement in the asset quality front (after witnessing continued stress for several quarters, Gross and Net NPA levels, on an absolute basis came in lower by 5.4% and 14.9% qoq).

At the CMP, the stock trades at valuations of 0.6x FY2015E ABV, which is relatively expensive than some of the other mid-size PSU banks with a better asset quality outlook and return ratios. Hence, we maintain our Neutral recommendation on the stock.

Source : Equity Bulls

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