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BOI
For 3QFY2011, Bank of India (BOI) registered strong net profit growth of 61.1% yoy to
`653cr, in line with our estimates of `669cr. However, the operating income came in ahead
of our estimates on account of a strong 32bp sequential expansion in domestic NIMs. The
yield on domestic funds for the bank improved by 24bp qoq, while the cost of funds was flat.
Net profit growth was also aided by lower effective tax rate. Advances grew by 6.2% qoq and
22.8% yoy, while deposits increased by 4.8% qoq and by 22.6% yoy. The asset quality of the
bank improved considerably during the quarter on account of a decline in slippages (down
to 1.1% v/s 1.7% in 1HFY2011) and strong upgradations of `600cr. Consequently, the gross
and net NPA ratio of the bank improved to 2.4% (from 2.6% in 2QFY2011) and 0.9% (from
1.1% in 2QFY2011), respectively. The provision coverage ratio including technical write offs
improved to 74.5% from 70% in 2QFY2011. At the CMP, the stock is trading at 1.4x
FY2012E ABV. We maintain Accumulate on the stock with a Target Price of `500.
India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details �� ��
BOI
For 3QFY2011, Bank of India (BOI) registered strong net profit growth of 61.1% yoy to
`653cr, in line with our estimates of `669cr. However, the operating income came in ahead
of our estimates on account of a strong 32bp sequential expansion in domestic NIMs. The
yield on domestic funds for the bank improved by 24bp qoq, while the cost of funds was flat.
Net profit growth was also aided by lower effective tax rate. Advances grew by 6.2% qoq and
22.8% yoy, while deposits increased by 4.8% qoq and by 22.6% yoy. The asset quality of the
bank improved considerably during the quarter on account of a decline in slippages (down
to 1.1% v/s 1.7% in 1HFY2011) and strong upgradations of `600cr. Consequently, the gross
and net NPA ratio of the bank improved to 2.4% (from 2.6% in 2QFY2011) and 0.9% (from
1.1% in 2QFY2011), respectively. The provision coverage ratio including technical write offs
improved to 74.5% from 70% in 2QFY2011. At the CMP, the stock is trading at 1.4x
FY2012E ABV. We maintain Accumulate on the stock with a Target Price of `500.
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