DCB Bank Q3 operating profit up 46% at Rs277.34cr on lower interest costs

DCB Bank reported a very marginal 3.33% growth yoy in revenues in the Dec-20 quarter at Rs1,023.86cr

Jan 23, 2021 04:01 IST India Infoline News Service

DCB Bank reported a very marginal 3.33% growth yoy in revenues in the Dec-20 quarter at Rs1,023.86cr. Treasury income was higher in the Dec-20 quarter on a yoy basis. However, interest income from retail lending business and from the corporate lending business saw a sharp fall in revenues on a yoy basis.

For the Dec-20 quarter, the operating profits were up 46.03% at Rs277.34cr. This growth in operating profits was on account of lower interest costs and due to lower operating expenses in the Dec-20 quarter. As a result, operating margin or OPM expanded from a level of 19.17% in Dec-19 to 27.09% in Dec-20 quarter.

Profit after tax (PAT) for the Dec-20 quarter was absolutely flat at Rs96.21cr. This was due to a sharp spike in loan loss provisions which went up yoy from Rs59cr to Rs148cr. Consequently, the PAT margins moderated from 9.76% to 9.40% in the same period.

Financial highlights for Dec-20 compared yoy and sequentially

DCB Bank
Rs in Crore Dec-20 Dec-19 YOY Sep-20 QOQ
Total Income (Rs cr) ₹ 1,023.86 ₹ 990.89 3.33% ₹ 970.98 5.45%
Operating Profit (Rs cr) ₹ 277.34 ₹ 189.92 46.03% ₹ 224.81 23.37%
Net Profit (Rs cr) ₹ 96.21 ₹ 96.70 -0.51% ₹ 82.29 16.92%
Diluted EPS (Rs.) ₹ 3.07 ₹ 3.07 ₹ 2.63
Operating Margins 27.09% 19.17% 23.15%
Net Margins 9.40% 9.76% 8.47%
Gross NPA Ratio 1.96% 2.15% 2.27%
Net NPA Ratio 0.59% 1.03% 0.83%
Return on Assets 1.01% 1.03% 0.86%
Capital Adequacy 18.32% 15.80% 18.28%

Key takeaways from the Dec-20 quarter results

  • During the Dec-20 quarter, DCB Bank saw a sharp fall in the gross NPAs to 1.96% and the net NPAs fell to 0.59% indicating that most of the short to medium term risks are already provided for.
  • DCB Bank has a comfortable capital adequacy ratio of over 18% well above the statutory requirements. In addition, the return on assets or ROA at above 1% is a major boost to the company’s performance.

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