TMB Ltd Q4FY24 results:

Guidance vs Performance :

Guided for a 12 – 15% growth | YoY, Advances grew by 6.5% and the total business grew by 4.8%.
Aimed to open 50 new branches this Fiscal year | Ended up opening only 22 new branches.
GNPA < 2% | GNPA – 1.44%
NNPA < 1% | NNPA – 0.85%
PCR > 85% | PCR – 87.52%
NIM > 4% | NIM – 4.11%
Cost to Income around 44% | Cost to Income – 47%
Slippage ratio < 1% | Slippage ratio – 1.36%
ROA – 1.75 to 2% | ROA – 1.84%

On the liability side, the deposits grew by 3.6%.
CRAR stands at 29.37%
Book Value per share stands at Rs.500.23 ( 14.33% YoY )
Net Profit for the year stands at Rs.1072.03Cr ( 4.15% YoY )

Yesterday in the ConCall, when asked about the underwhelming rate of growth at which the bank is currently growing ( 5 to 7%), CEO shared that this is mainly because the bank is currently going through a transformational phase. It may take upto a year to stabilize and once it stabilizes, the bank aims to grow at 15%.

In summary, the bank widely underperformed it’s FY24 growth guidance but achieved it’s guidance at the asset quality side.

.

The Q4 profit is largely due to PLI received/recognised in this quarter. PLI of 156 cr may not be there every quarter.

Disc. Invested

There are a few positive points from my side.

1 – Management is by Reliance
2 – Huge cash on the books. But management is not in a ‘HURRY to piss it off.’
3 – It’s an Indian company. The Indian government will always give preference to Indian companies over foreign companies. Ex. Mapmyindia is more favoured by GOI over, say, Google Maps. The same thing may play out here. (I am just trying to connect the dots )

Invested and BIASED.

dr.vikas

Yes they have good order book , but they don’t give any guidance, so difficult to anticipate numbers for forthcoming quarters.

And trading at such multiples, if even growth slows gradually in forthcoming quarters stock may give steap correction.

Looks intresting but kind of afraid to build positions at this multiple