Indian Bank Q1 Results Review - Multiplies Nearly 3.8 Times But Still Has Material Upside: Yes Securities

Yes Securities Report

Indian Bank's gross non-performing asset additions amounted to Rs 19.56 billion for Q1 FY25, translating to calculated annualized slippage ratio of 1.46% for the quarter.

Gross NPA additions had amounted to Rs 12.68 billion during Q4 FY24. Recoveries in Q1 were Rs 12.9 billion and the management has guided for total recoveries of Rs 70 billion in FY25 including AUC recovery of Rs 20 billion.

Provisions were Rs 12.6 billion, up by 0.9% QoQ but down by - 27.7% YoY, translating to calculated annualised credit cost of 97 bps. The management has stated that the credit cost at 71 bps (assume specific) is marginally down sequentially and they expect it to decline further from current levels.

The whole bank net interest margin was at 3.44%, flat QoQ but down -12 bps YoY. The cost of deposits in Q1 was at 5.05%, up by 4 bps QoQ and 45 bps YoY and the management expects it to further inch up by 3-5 bps. The share of MCLR linked loans is 61% of the total advances and hence the management expects that the NIMs would be stable around current levels.

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