Indusind Bank Ltd Q4FY21 - Earning Analysis | Globe Capital
17-Nov-2021
Indusind Bank Ltd Q4FY21 – Earning Analysis

At the CMP of Rs. 934, the stock is trading at full year P/BV multiple of 2.12 times with the full year Book Value of Rs 440 per share.

Q4 FY21 Overview and Verdict
CMP
Rs. 934
Verdict
Higher than estimates

At the CMP of Rs. 934, the stock is trading at full year P/BV multiple of 2.12 times with the full year Book Value of Rs 440 per share.

Net Profit for Q4-FY21 at Rs. 926 crores; up by 193% Y-o-Y

Net Interest Income for Q4-FY21 at Rs. 3,535 crores up by 9% Y-o-Y, NIM stood at 4.13% and fee income back to pre-covid levels

Pre Provision Operating Profit (PPOP) at Rs. 3,129 crores grew by 10% Y-o-Y; PPOP/Assets at 3.68%

GNPA reduced to 2.67% for Q4-FY21 from 2.93% for Q3-FY21 (including Proforma NPA’s), PCR at 75%; NNPA at 0.69%

Total loan related provision at 122% of GNPA and 3.33% of loans

CRAR at 17.38% post promoter’s contribution of Rs. 2,021 crores at Rs. 1,709 per share

NIM at 4.13%, Net NPA at 0.69%, Provision Coverage Ratio at 75%, Capital adequacy (CRAR) ratio at 17.38% and Liquidity Coverage Ratio at 145% underscore the strength of operating performance of the Bank and adequacy of capital and liquidity buffers.

Board recommends dividend of Rs 5 per share (50%).

Balance Sheet as of March 31, 2021

As of March 31, 2021 was Rs. 3,62,903 crores as against Rs. 3,07,230 crores as of March 31, 2020, a growth of 18%. Total deposits as of March 31, 2021 were Rs. 2,55,870 crores as against Rs. 2,02,027 crores, an increase of 27% over March 31, 2020. CASA deposits stood at Rs. 1,06,791 crores with Current account deposits at Rs. 35,726 crores and Saving account deposits at Rs. 71,065 crores. CASA deposits comprised of 42% of total deposits as of March 31, 2021. Advances as of March 31, 2021 were Rs. 2,12,596 crores as against Rs. 2,06,783 crores as at March 31, 2020.

Management Takeaways:

As of March 31, 2021, the Bank’s distribution network included 2,015 branches/banking outlets and 2,872 onsite and offsite ATMs, as against 1,911 branches/banking outlets and 2,760 onsite and offsite ATMs as of March 31, 2020. The client base stood at 28 million as on March 31, 2021.

According to management “The Indian economy showed significant resilience against the impact of Covid -19 and had begun recovering in a gradual manner. While that momentum may have reduced due to the onset of a second wave, the mass vaccination drive should help getting things back on track. The Bank look forward to participating in this journey with a strengthened balance sheet during the year. During FY21, as well as Q4, the Bank witnessed healthy growth in its top line as well as in its Pre-Provision Operating Profits. For the quarter, oits net profit improved to Rs. 926 crores in Q4-FY 21 from Rs. 830 crores in Q3-FY 21. The Bank has conservatively built a strong Provision Cover 75% resulting in a Net NPA of 0.69% compared to previous year of 0.91%. The bank is also carrying significant buffers outside these provisions as a prudent measure. Its areas of domain expertise such as vehicle finance, micro-finance and diamond finance have witnessed strong disbursements and we expect the growth to become further broad-based in the current financial year”.

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