Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
http://www.icicidirect.com/mailimages/ICICIdirect_DevelopmentCreditBank_Q4FY12.pdf
A p o s i t i v e s u r p r i s e …
DCB’s Q4FY12 profit at | 17.3 crore (grew 52% YoY, 11% QoQ) was 9%
above our estimates mainly due to lower provisioning expenses (down by
18% YoY) and higher-than-expected loan growth of 24% YoY to | 5284
crore. However, NII at | 57 crore declined 4% QoQ owing to a 25 bps
sequential fall in NIM. Stable yield and a 41 bps rise in cost of funds led to
a decline in NIM during the quarter. The bank raised | 94 crore through
QIP and | 98.75 crore through preferential allotment, which resulted into
Tier 1 capital rising to 13.8% from 11.2% in Q3FY12. Total CAR stands at
15.4% as on Q4FY12.
We have revised business growth higher to 22% in FY13E from 17%
earlier and expect PAT to grow at 29% CAGR over FY12-14E.
ƒ Credit growth surprises positively
After plunging sharply from 23.5% YoY growth in FY11 to 8.9% YoY
growth in Q3FY12, advances increased by | 978 crore to | 5284
crore in Q4FY12 recording growth of 24% YoY. Meeting the priority
sector target was the major reason for such a sharp rise in loans
during Q4FY12. The agricultural loan book rose strongly by 92%
QoQ to | 801 crore. The corporate book also witnessed healthy 34%
QoQ growth to | 1194 crore. However, the retail portfolio grew by a
moderate 8% QoQ to | 1853 crore. We are revising our FY13E credit
growth target from 20% to 22%.
ƒ Asset quality improves sharply
Asset quality witnessed a sharp improvement with absolute GNPA
declining by | 14.6 crore sequentially to | 242 crore and NNPA
declining by | 14.1 crore to | 30 crore. The NNPA ratio at 0.6% was
the lowest in the last few quarters. The provision coverage ratio
stands at 91% as against 87% in Q3FY12 and Q4FY11.
V a l u a t i o n
At the CMP of | 50, the stock is trading at 1.3x its FY14E ABV. With an
improvement in loan growth and asset quality and margins of ~3.0-3.1%,
we expect NII and profit to grow at 22% and 29% CAGR to | 342 crore
and | 93 crore, respectively, over FY12-14E. We maintain our target price
of | 60 (1.6x FY14E ABV) from a 12-15 months perspective
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
http://www.icicidirect.com/mailimages/ICICIdirect_DevelopmentCreditBank_Q4FY12.pdf
A p o s i t i v e s u r p r i s e …
DCB’s Q4FY12 profit at | 17.3 crore (grew 52% YoY, 11% QoQ) was 9%
above our estimates mainly due to lower provisioning expenses (down by
18% YoY) and higher-than-expected loan growth of 24% YoY to | 5284
crore. However, NII at | 57 crore declined 4% QoQ owing to a 25 bps
sequential fall in NIM. Stable yield and a 41 bps rise in cost of funds led to
a decline in NIM during the quarter. The bank raised | 94 crore through
QIP and | 98.75 crore through preferential allotment, which resulted into
Tier 1 capital rising to 13.8% from 11.2% in Q3FY12. Total CAR stands at
15.4% as on Q4FY12.
We have revised business growth higher to 22% in FY13E from 17%
earlier and expect PAT to grow at 29% CAGR over FY12-14E.
ƒ Credit growth surprises positively
After plunging sharply from 23.5% YoY growth in FY11 to 8.9% YoY
growth in Q3FY12, advances increased by | 978 crore to | 5284
crore in Q4FY12 recording growth of 24% YoY. Meeting the priority
sector target was the major reason for such a sharp rise in loans
during Q4FY12. The agricultural loan book rose strongly by 92%
QoQ to | 801 crore. The corporate book also witnessed healthy 34%
QoQ growth to | 1194 crore. However, the retail portfolio grew by a
moderate 8% QoQ to | 1853 crore. We are revising our FY13E credit
growth target from 20% to 22%.
ƒ Asset quality improves sharply
Asset quality witnessed a sharp improvement with absolute GNPA
declining by | 14.6 crore sequentially to | 242 crore and NNPA
declining by | 14.1 crore to | 30 crore. The NNPA ratio at 0.6% was
the lowest in the last few quarters. The provision coverage ratio
stands at 91% as against 87% in Q3FY12 and Q4FY11.
V a l u a t i o n
At the CMP of | 50, the stock is trading at 1.3x its FY14E ABV. With an
improvement in loan growth and asset quality and margins of ~3.0-3.1%,
we expect NII and profit to grow at 22% and 29% CAGR to | 342 crore
and | 93 crore, respectively, over FY12-14E. We maintain our target price
of | 60 (1.6x FY14E ABV) from a 12-15 months perspective
No comments:
Post a Comment