Published on 20/03/2017 12:28:31 PM | Source: Reliance Securities Ltd

Buy Indian Bank Ltd For Target Rs.316.00 - Reliance Sec

Posted in Broking Firm Views - Short Term Report | #Banking Sector #Indian Bank Ltd #Trading Report #Reliance Securities Ltd


*  Indian Bank closed 2.6% higher along with sharp surge in trading volume, outperforming benchmark NIFTY by 2.6%.

*  Despite tough operating scenario, the Bank has delivered an improved performance in 3QFY17/9MFY17 on key operating and asset quality parameters.

*  The Bank has delivered healthy growth in operating profit (Rs10.2bn; +34.3% yoy & +1.5% qoq) in 3QFY17 led by strong growth in trading income (Rs2.9bn; +338% yoy & +10.1% qoq) along with relatively lower opex (Rs8.3bn; +4.5% yoy & -3.7% qoq).

*  Slippages remained stable at Rs9.3bn in 3QFY17 v/s Rs9.5bn in 2QFY17 and Rs17.4bn in 3QFY16. It expects improvement in upgrade and recovery to outweigh fresh slippages in the coming quarters, which will help it in bringing down GNPA from current levels.

*  We continue to reiterate our belief that the Bank is better placed when compared to its peers in terms of efficient clean up of the current loan book by its management. We maintain our BUY recommendation on the stock with a Target Price of Rs316.


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