After looking through the results and going through the comments and VV’s videos on TV channels, it is absolutely clear that the bank fundamentals continue to be sound. The bank has taken a higher provision in Q3 which has caused the PAT to stay flat and share price to drop. Since no requirement apparently exists to raise capital in FY 25 so the intent could be to create some reserve ammunition to ensure a good PAT when the time arrives in maybe FY 26. It would be a good strategy for ensuring proper pricing of the shares.
The infra book is now 1.6% as it is reducing in rupee terms and the total loan book size is increasing. However it is still around 3000 crores. How much hit it would cause to the balance sheet before it completely goes off the book is not known to us. Perhaps this question could be posed in next concall.
VV says “he needs approx 50,000 crores every year as deposits for which he has already got adequate machinery in terms of branches. He has a new goal of 20-22% asset growth, to reach guidance 2.0 in five years. He can exceed the targets if he finds it safe to do so. The reduced capex will start showing up as higher profitability in next 3 quarters.”
I believe this, as it is doable, especially considering their past performance.
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