This topic contains 10 replies, has 1 voice, and was last updated by vishal Patel, Mumbai 3 months ago.
October 13, 2016 at 8:43 pm #3449
1)IndusInd Bank’s (IIB) 1QFY17 PAT grew 26% YoY (in line with expectations) to
INR7b, led by strong core PPoP growth of 27% YoY and 9% QoQ. Asset quality
remained stable QoQ, with GNPA at 90bp and stable PCR of 59%.
2)NII growth (33% YoY, 8% QoQ) was driven by 27% YoY loan growth and uptick
in NIM to 4% (v/s 3.97% in 1QFY17 and 3.88% in 2QFY16). Core fee income
growth, which came in marginally below loan growth at 23% YoY, was broad-
based, with all segments barring FX income contributing to growth. Investment
banking fees remained strong at 15% of PBT.
3)Corporate/consumer loans exhibited robust 26/27% YoY growth, resulting in a
60:40 loan mix at the end of the quarter. However, adjusting for the gems and
jewelry and the microfinance portfolio, which are included in corporate loans,
the mix would be close to 50:50.
4)Deposit growth witnessed a sequential uptick to 39% from 31% in 1QFY17. This
was driven by strong CASA deposit growth. There were one-off items that
contributed to strong CA growth. As at the end of the quarter, CASA ratio stood
at 36.5% compared to 34.4% in 1QFY17.
5)Other highlights: (a) Restructured loans declined to 0.44% of loan book, as one
account slipped into NPA, and (b) CET1 was strong at 14.68% (-13bp QoQ).
6)Management expects to sustain 4% NIMs despite MCLR cuts, due to increasing
share of consumer finance portfolio as well as better cost of funds on account of
lower bulk borrowings.
7)Management is bullish on the CV cycle from a 2-3 year perspective. Currently,
yields in the CV segment range from 10% to 11.5%. Historically, the LGD has
been in the range of 30-35%.
8)MFI AUM stands at around INR30b. Management continues to be bullish on
prospects in the microfinance segment.
9)The bank has 292 branches in ‘Home Markets’, i.e., markets where it wants to
be a top player with at least 4-5% share in CASA deposits.
10)Average ticket size in the mid-corporate segment is INR150-200m
The bank is on track to reach their goal of 1200 branches by end-FY17.
Currently, around 320 branches are less than years old. These branches are yet to operate at optimisation level.
Overall superior margins, focused fee income strategy and control over C/I ratio
will keep earnings momentum healthy (~26% CAGR over FY16-19). Capitalization
remains one of the best in the industry at 14.7% CET1 ratio. I believe that I should invest in this scrip since I consider its
target price of INR 1,400 .
I request forum members to offer their comments on this scrip.
October 13, 2016 at 8:47 pm #3450
I saw Q 2 results of Indus Ind Bank and I also felt that the scrip has strong potential to move upward in coming months. The bank is related to Ashok Leyland group/Hinduja group and because of increase in commercial vehicle sales, this bank will be most benefited.
The scrip has given strong returns during last 6 months. and can give such returns in coming months.
October 13, 2016 at 8:49 pm #3451
Rahil Shah, Ahmedabad
This bank has showed strong Q 2 results and due to high fancy towards banking stocks, it can move up marginally but I think ICICI bank can provide higher returns on CMP.
October 14, 2016 at 6:38 pm #3468
Mehul Patel, Ankleshwar
I agree with the analysis.the bank has focus on Auto loans and more particularly loan for commercial vehicles. so now auto loans are expected to increase at tremendous speed.
The government will also push for scappiing of old trucks and buses so sale and loan will increase.
I believe that this scrip can give atleast 15% rise in coming months.
February 21, 2017 at 4:12 pm #4599
vishal Patel, Mumbai
Vedanta : The metal giant which is in the process of merging itself with Cairn India is expected to be rock start in the coming sessions. But at the current price of Rs.268 and will cross Rs. 300 in no time.