Karnataka Bank Ltd's Q1FY19 standalone net profit rises 21.9% yoy to Rs163.20cr : Beats Estimates

The bank’s standalone NII stood at Rs468.60cr, up 10.41% yoy but down 13.46% qoq.

Jul 17, 2018 10:07 IST India Infoline Research Team

Karnataka Bank Ltd Q1FY19

Standalone Results Q1FY19: ( cr)

Q1FY19 YoY (%)
NII 468.60 10.4
NPA (%) 4.7 38
Provisions 222 11.6
Net Profit (adjusted) 163.20 21.9
***NPA change is bps

Karnataka bank’s NII has improved by 10.4% yoy to Rs468.6cr as against Rs 424.4cr. It’s net profit for the quarter was above estimates, which has come at Rs163.2cr against Rs133.8cr yoy, which is up by 22%. NIMs for the quarter has improved by 3 bps yoy to 3%. GNPA for Q1FY19 stood at 4.72% against 4.92% qoq, which has declined by 20bps. NNPA for the quarter stands at 2.92% against 2.96% qoq, which has declined by 4bps.
  • The deposits of the bank for the quarter grew from Rs56,227cr to Rs62,725cr with a yoy growth rate of 11.56%.
  • Advances for the quarter grew from Rs38,405cr to Rs47,731cr with a yoy growth rate of 24.28%. Managment guided that advances for FY19 would grow by more than 20%.
  • The bank sees strong traction in mortgage backed loans. This book’s ticket size is Rs5cr to Rs50cr. These
    mainly consist of commercial properties and malls.
  • Retail advances to corporate advances ratio stood at 45: 55.
  • Yield on advances stood at 9.29% against 10.22% yoy. Cost of deposits dropped to
    5.88% against 6.33% yoy.
  • Deposits of the bank grew by 11% yoy. CASA proportion decreased from 28.9% to
    27.33% yoy. C-D ratio for the bank increased to 76.1% against 68.3% yoy.
  • The CD ratio has improved to 76.1% from 68.3%, as on Q1FY19 end.
  • Bank's CRAR and PCR as of Q1FY19 end stood at 11.6% and 57.21% respectively.
  • There are 3 cases which have been referred to NCLT. Provisions of 76% on this have been made. In Q1FY19 Rs80cr was charged into provisions. No portfolios were sold to ARCs in this quarter.
  • Cost-to-income ratio stood at 45.54% vs. 51% yoy.
  • Credit cost is expected to be around 50bps in the coming quarters. And PCR is expected to remain
    around 55% to 57%.

Technical View:

Karnataka Bank Ltd ended at Rs124.25, up by 5.7 points or 4.81% from its previous closing of Rs118.55 on the BSE.
The scrip opened at Rs119.85 and has touched a high and low of Rs127.15 and Rs118.55, respectively. So far 1,60,72,209 (NSE+BSE) shares were traded on the counter. The stock is currently trading below its 200 DMA.

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