Views on Bank Of India results - Angel Broking

Views of Mr. Vaibhav Agrawal (VP Research – Banking, Angel Broking) on Bank of India results:

"Bank of India's operating numbers came below ours as well as street's estimates, while asset quality witnessed pressures qoq. On the operating front, NII for bank grew healthy by 23.1% yoy (12.1% growth qoq) on back of 28.1% yoy advances growth. Non-interest income de-grew by 16.5% yoy. Continuing the trend of last three quarters opex grew higher by 31.4% yoy. Overall the Pre-Provisioning operating profit de-grew by 3.8% yoy. On the asset quality front bank faced higher stress compared to its PSU peers as absolute gross NPAs increased by 18.4% qoq while absolute net NPAs increased by 20.7% sequentially. Thus gross and net NPAs ratios increased by 34bp and 25bp qoq to 3.2% and 2.0% respectively. Overall earnings for the bank de-grew by 26.3% yoy. At CMP, the stock trades at relatively cheaper valuations of 0.6x FY2016E ABV compared to its peers. We recommend Buy rating on the stock."

Source : Equity Bulls

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