Canara Bank: Q1FY15 Result Analysis
Nutan Gupta / 22 Jul 2014
Bengaluru-based Canara bank announced its financial results for the quarter ended 30th June 2014. The Bank’s net profit went up by 32% on sequential basis.
The total income of Canara Bank rose to Rs 11610 crore in June ’14 from Rs 10508 crore in June’13, up 10.48%. The total expenses of the bank increased to Rs 9923 crore in June’14 from Rs 9728 crore in Mar’14. This was mainly on the back of increase in employee cost which rose to Rs 1038.10 crore in June’14 from Rs 979.24 crore in Mar’14.
Canara bank reported a net profit of Rs 807 crore as compared to a net profit of Rs 792 crore in June’13. However on sequential basis, the net profit was up by 32% to Rs 807 crore as against Rs 611 crore in Mar’14. This was mainly on the back of decrease in provisions & contingencies by 27%. It was down to Rs 788.14 crore in June’14 from Rs 1091.27 crore in Mar’14 and Rs 916.19 crore in the same quarter last year.
CASA was up 16.94% to Rs 103279 crore from Rs 88312 crore (YoY). Advances were up by 21.24% to Rs 302964 crore in June’14 from Rs 249891 crore in the same quarter last year. The operating profit of the bank declined on a YoY basis to Rs 1795 crore in June’14 from Rs 1898 crore in June’13. The EPS stood at Rs 13.65 per share, down from Rs 17.88 per share in the same quarter last year. However, EPS was up from Rs 9.24 per share on a sequential basis. Net interest income increased to Rs 2429 crore in June’14 from Rs 1991 crore in June’13, up 22% (YoY).
Coming to the asset quality of the bank on a sequential basis; the gross non-performing assets (NPA) was up to 2.67% from 2.49%. Also, the net NPA was up from 1.98% in Mar’14 to 2.03% in June’14.The capital adequacy ratio which ensures the liquidity of the bank stood at 10.23% in June’14 as against 10.63% in Mar’14 (QoQ) and down from 11.13% in June’13, indicating that the liquidity of the bank has decreased.
The number of branch network was up from 3770 branches in June’13 to 5010 branches in June’14 (YoY). Also, the ATM network expanded to 6509 in June’14 from 3754 in June’13 and up from 6312 in Mar’14, which was in line with the management’s expansion strategy stated last quarter.
The stock is trading at a price to book value of 0.76x.
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