Monday, August 1, 2011

IDBI


IDBI Bank has reported modest results in the quarter ended June 11 with 34% increase in the Net Profit at Rs. 335.10 crore over 36% increase in the Net Interest Income at Rs.1152.44 crore. Reversal of provision on investments at Rs. 92 crore aided provisions & contingencies down by 15% to Rs. 425.70 crore despite of additional 279.60 crore provisions on enhanced rates of provisioning for NPA's and restructured advances. While the margins improved despite the bank conscious effort to increase its advances book, higher slippages remained a concern.
The figures of the current period include working results of the two erstwhile wholly owned subsidiaries namely IDBI Home Finance and IDBI Gilts consequently on their merger with bank w.e.f 1 January 2011. Accordingly, the figures of the previous period are not strictly comparable.
Asset Quality
  • Asset Quality of the bank has deteriorated in the quarter under review. Gross NPA has inched up by 25% y-o-y and 18% q-o-q to Rs. 3287.76 crore in quarter ended June 11. Slippages were to the tune of Rs. 622 crore translating to slippage ratio of 1.6% in quarter under review. The % GNPA has increased to 2.1% in quarter under review from 1.94% a year ago and 1.76% a quarter ago.
  • The Net NPA has inched up by 20% y-o-y and 15% q-o-q to Rs. 1932.80 crore in the quarter ended June 11. % NNPA has increased to 1.25% in quarter under review against 1.19% a year ago and 1.06% a quarter ago. According to our calculations Provision coverage ratio stood at 41.2% at end of June 11.
  • The bank has transferred surplus NPA provision of Rs. 111.93 crore held as on September 30, 2010 vis- a-vis as required as per prudential norms to countercyclical provisioning Buffer which is in compliance with recent RBI norms.
Business highlights:
  • Business of the bank improved by 13% y-o-y a slipped marginally 2% q-o-q to Rs.331266 crore for the quarter ended June 11.
  • The advances grew by 15% y-o-y and 1% q-o-q to Rs. 154984 crore at end of June 11.
  • Deposits grew by12% y-o-y and marginally slipped by 2% q-o-q to Rs. 176282 crore at end of June 11.
  • At end of June 11, aggregate assets stood at Rs. 249571 crore representing growth of 11% y-o-y and de growth of 1% on q-o-q basis.
  • Capital Adequacy ratio has stood at 13.83% with Tier I capital of 8.11% at end of June 11 against 13.64% at end of March 11.
  • Return on assets stood at 0.54% in quarter under review against 0.45% a year ago and 0.73% a quarter ago.
Quarterly Performance:
The bank has reported 31% increase in the Interest earned at Rs. 5628.93 crore, thanks to 36% jump in the interest from advances at Rs. 4299.90 crore. However, interest expended inched up by 30% to Rs. 4476.49 crore and led NII up by 36% to Rs. 1152.44 crore. NIM improved 2.07% in quarter under review against 1.61% in the corresponding previous quarter. The other income has slipped by 9% to Rs. 430.90 crore and curtailed growth in Net Total income up by 20% to Rs. 1583.34 crore.
The staff cost inched up by 4% to Rs. 244.02 crore, other operating expenses by 22% to Rs.308.52 crore there by resulting Operating expenses up by 14% to Rs. 552.54 crore. The Cost to income ratio has slipped by 200 bps to 34.9% in quarter under review and led Operating Profit up by 24% to Rs. 1030.80 crore. The provisions and contingencies has slipped by 15% to Rs. 425.70 crore despite making additional provisioning of Rs. 279.60 crore consequent to enhanced rates of provisioning for NPA's and restructured advances. The bank has reversed Rs. 92 crore of provisions on investments in the quarter under review. Resultantly, PBT was up by 84% to Rs. 605.10 crore. After accounting 244% jump in taxation at Rs. 270 crore, Net Profit stood high by 34% to Rs. 335.10 crore.
The profit of the bank during the quarter was higher by around Rs. 18 crore on account of including working results of the two erstwhile wholly owned subsidiaries namely IDBI Home Finance and IDBI Gilts.
Yearly Performance:
For the year ended March 2011, IDBI bank has reported robust increase in NII by 92% toRs. 4328.89 crore and 60% increase in Net profit at Rs. 1650.32 crore. Although dip in the other income by 9% has curtailed growth in the Net total income to 41% at Rs. 6412.54 crore; 500 bps dip in the cost to income ratio at 35.2% has paved Operating profit up by 53% to Rs. 4157.85 crore. Finally 48% increase in the total provisions including taxation atRs. 2507.53 crore has resulted in 60% growth of Net Profit.
Other Information:
  • The scrip is hovering at Rs. 128.20 on BSE.
  • Considering EPS of Rs. 13.6, PE stands at 6.1 times.
  • At Book value per share of Rs. 151.35 and Adjusted Book Value per share of Rs.104.90 at end of June 2011, the P/BV and P/ABV works out to be 0.8 and 1.2 respectively.
IDBI Bank: Financial Results


Particulars1106 (3)1006 (3)Var %1103 (12)1003 (12)Var %
Interest Earned5628.934282.153118600.8215261.3222
Interest Expended4476.493437.803014271.9313005.2210
Net Interest Income1152.44844.35364328.892256.1092
Other Income430.90472.87-92083.652301.73-9
Net Total Income1583.341317.22206412.544557.8341
Operating Expenses552.54486.20142254.691831.4223
Operating Profits1030.80831.02244157.852726.4153
Provisions & Contingencies425.70501.63-151876.871681.6912
Profit Before Tax605.10329.39842280.981044.72118
Provision for tax270.0078.50244630.6613.59999
Net Profit335.10250.89341650.321031.1360
EPS*(Rs)13.610.216.810.5
* Annualized on current equity of Rs. 984.61 crore.
Face Value: Rs. 10
Var % exceeding 999 has been truncated to 999
Figures in Rs. crore

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