“Karur Vysya Bank, net profit for FY2011-12 was at Rs. 501.7 crore as compared to Rs. 415.6 crore for FY2010-11, a growth of 20.72% over the previous year. Operating Profit for FY2011-12 increased to Rs. 725.7 crore as against Rs. 600.6 crore for FY2010-11.”
“Total Income of the bank stood at Rs. 3,620.52 crore for the period ended 31st March 2012 as against Rs. 2,482.03 crore during the previous year, clocking a remarkable growth of 45.87%. Net Interest Income (NII) for the year ended 31st March 2012 grew by 19.59% to Rs. 917.12 crore as against Rs. 766.85 crore year ended 31st March 2011 on account of growth in advances & investments. The operating profit of the bank stood at Rs. 725.71 crore for year ended 31st March 2012 as against Rs. 600.58 crore for the corresponding period of previous fiscal, posting a robust growth of 20.83%. Net Profit was up 20.72% at Rs. 501.72 crore against Rs. 415.59 crore. Karur Vysya Bank has declared a dividend of Rs 14 a share (140%). Net Interest Margin fell marginally to 3.08% in FY12 as against 3.39% in the corresponding period of the previous year. Return on Average Assets of the bank stood at 1.56% as for the year ended 31st March 2012.”
“The bank recorded an increase of 31.66% in its business mix and the total business stood at Rs. 56,317 crore during the year, up from the 42,774 crore recorded during the previous year. Total deposits grew by 29.89% to Rs. 32,112 crore as at March 31, 2012 from Rs. 24,722 crore as at March 31, 2011. Gross advances grew by 34.08% on year on year basis to Rs. 24,205 crore from Rs. 18,052 crore mainly due to advance to NBFC’s sector like IL&FS (NBFC showed a jump of 112.27% in FY12). The Balance Sheet size grew by 33.34% on YoY basis to Rs. 37,636 crore from Rs. 28,225 crore.”
“Karur Vysya Bank has reported a good growth in FY12. Bank has set a target of business level to the tune of Rs. 72,000 crore with aiming to achieve Rs 41,000 crore of deposit and Rs 31,000 crore of Advances by March 2013. Management is confident for NIM to stay above 3% in near term but CASA will be a real challenge for the Bank. Business mix is going to benefit to the bank. Going forward, the major thrust will be focus on Corporate, SME and CASA. The bank has also set up a robust online platform for customers to transact without coming to the branch. These measures are expected to move the customers to alternate channels of delivery. The Bank has also increased the number of branches authorized to sell gold coins and/or silver bars. Further thrust is being given to improve its performance in selling third party products. At current price of Rs 419.00, the stock quotes at 1.5x and 1.3x adjusted Book Value (ABV) FY13 and FY14 respectively.”
“We expect Karur Vysya Bank to deliver robust growth in net earnings over FY12‐FY14. We have revised our FY13 and FY14 Estimates by 7% and 8% respectively. We recommend BUY rating on the stock with target price of Rs 460.00 (the stock will trade at 1.6x and 1.4x ABV FY13 and FY14 respectively) with an upside potential of 10% from current levels,” says Magnum research report.
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