Oriental Bank Gives Out A Stagnant Q4 Performance

Operating profit of the bank showed sharp increase in numbers and went up by 46% to Rs 1383.7 crore in Q4FY14 due to exponential growth in other income of the bank, which grew by 63.4% to Rs 754.5 crore as compared with Rs 461.7 crore in same quarter of previous year. However, net profit of the bank remained stagnant during the said quarter and stood at Rs 310 crore against Rs 308 crore in Q4FY13 mainly due to high provisions done by the bank during the preceding quarter.

Total interest income of the bank stood at Rs 4901 crore in Q3FY14 with a decent growth of 8% yoy against Rs 4534 crore in same period previous year which is mainly driven by a good growth of 13.7% in corporate banking (contributes 44.5% of total revenue) and retail banking segment, up by 13.5% during the quarter. On the other hand, the bank recorded some improvement in its expenditure and its employee cost came down by 12.7% to Rs 386.4 crore in Q4FY14 against Rs 442.8 crore in same period previous year. However, its other expenses showed a marginal increase of 2.4% yoy.

On the assets quality front the bank has disappointed the street, its Gross NPA (Non performing assets) rose to 3.99% of total lending in Q4FY14 from 3.87% in Q3FY14. However its net NPA has showed marginal improvement in numbers and reached at 2.82% in the said quarter from 2.91% in Q3FY14 but it is mainly on account of high provision which grew by 66% q-o-q to Rs 930.7 crore in Q3FY14. 

As far as its whole year performance is concerned, the bank NII grew by 9% to Rs 5127 crore in FY14 while operating profit went up by 12.59% to Rs 4155.5 crore during the said year from Rs 4701.5 crore in FY. But net profit for the bank fell by 14.2% to Rs 1139.4 crore in FY14, from Rs 1328 core in same period previous year. 
Currently the stock is at its CMP of Rs 247.5 per share, is trading at 0.57x of book value.