South Indian Bank is the top gainer on the BSE, going up almost 17% to Rs.14.71. Volumes are huge at over 1 crore shares changing hands and the stock remains firmly in the green.
Call it is low base effect or whatever, the fact is that the Bank has bounced back well in Q2FY19. Net profit of the Bank jumped up 16 times to Rs. 70 crore (YoY) though NII showed a very marginal less than 1% rise at Rs.506 crore (YoY). Clearly, the jump in net profit was mainly on account of lower provisions.
What really got the market going on the counter was the improvement in asset quality. Gross NPA rose slightly from 4.54% to 4.61% (QoQ) but Net NPA was down at 3.16% from 3.27%.
The Bank has scaled down its provisions from Rs.231 crore to Rs.205 crore (QoQ) and from Rs.454 crore (YoY). Growth drivers continue to be retail, agriculture and MSME sectors.
Deposits increased by 11.5% (YoY) at Rs.74,911 crore while advances rose 15.5% at Rs.57,413 crore.
CASA now stands at 24.55% of total deposits and NRI deposits showed a healthy growth of 14.43%, with deposits accounting for 27% of total deposits.
The bank’s capital adequacy ratio stands at 12.11 per cent as on September 30.