To add to that, you’re getting a 80yr old business, a legacy brand, that’s going through some restructuring, and has a product basket with good domestic tailwinds, for a 1200cr market cap.

Yes it’s not hockey stick growth at the moment and a lot remains to be seen. But, that is how turnarounds are and while the journey can be unclear & painful, if executed well, the outcome can be portfolio altering.

Karur Vysya Bank –
Q2 FY 25 results and concall highlights –

Advances / Loans @ 80.2k cr, up 14 pc YoY
Deposits @ 95.8k cr, up 15 pc YoY
CASA deposits @ 28.3k cr, up 5 pc YoY

NII – 1060 vs 915 cr, up 16 pc
Other income – 472 vs 339 cr, up 39 pc
Operating expenses – 716 vs 616 cr, up 16 pc
Operating profits – 816 vs 638 cr, up 28 pc
Provisions – 180 vs 127 cr, up 42 pc
PBT – 636 vs 511 cr, up 24 pc
PAT – 473 vs 378 cr, up 25 pc

RoA @ 1.72 vs 1.57 pc
RoE @ 17.3 vs 16.5 pc
NIMs @ 4.11 vs 4.07 pc
Spreads @ 3.33 vs 3.32 pc
Cost/Income @ 46.72 vs 49.14 pc

Gross NPAs @ 1.10 pc, down 63 bps
Net NPAs @ 0.28 pc, down 19 bps
PCR @ 96 pc

Breakup of loan book –

Retail – 19.6k cr, up 21 pc YoY

Agri ( more than 90 pc are against gold ) – 18.8k cr, up 16 pc YoY

Corporate ( loans > 25 cr ) – 13.1k cr, down 9 pc YoY

Commercial ( loans < 25 cr ) – 28.7k cr, up 22 pc YoY

Avg ticket size of commercial loans is around 50 lakh. 38 pc of commercial loans are > 5 cr

Avg ticket size of corporate loans around 36 cr. 86 pc of corporate loans are < 150 cr

Slippages for Q2 @ 181 cr vs 155 cr YoY ( well within control )

Recoveries for Q2 @ 100 cr vs 115 cr YoY

Total number of branches @ 841 on 30 Sep 24 vs 799 on 30 Sep 23

Retail loan book growth was primarily driven by mortgages

Deposits growth remains a key priority for the bank. Expecting a 10 bps rise in rate of deposits in Q3

Bank is able to sustain NIMs > 4 pc due better growth in retail, agri segments vs low margin corporate segment

Expecting NIMs in Q3 to be around 4 pc mark ( vs 4.11 pc in Q2 due expectation of moderate increase in rate of deposits and no increase in yield on advances )

Confident of sustaining RoAs @ > 1.65 pc levels for rest of FY

Confident of maintaining the gross slippage ratio below 1 pc for full FY ( in Q2, it was 0.23 pc – not annualised )

Total unsecured book stands @ 2.4 pc ( being very cautious in growing the MFI book )

Bank is de-focussing on the corporate segment because of lower yeilds vs the funds they r raising via term deposits. Once CASA growth comes back, they ll re-focus on their corporate loan book

26 pc of bank’s book consists of Gold Loans ( under Agri + Retail segments )

Textile sector ( in the MSME segment ) in TN area is doing well vs last year

Yeild on Loan against property is around 9.5 pc. Company’s LAP portfolio is majorly concentrated in South India ( TN + Karnataka + AP + Telangana )

Spending aggressively on IT + Cyber Security + New branches. Aim to open 100 branches in current FY

Aim to keep growing the Retail + Agri + MSME book at rates > 18 pc. Achieving this is absolutely critical for the bank as the corporate book is expected to continue to de-grow for some time

Disc: holding, biased, not SEBI registered, not a buy/sell recommendation

Gas allocation reduced. It may need to increase tarriff to offset from private player gas buying.

QIP was raised via convertible debentures and warrants, not equity. They will get converted in 1 year if i remember correctly

Hii sidd sir . I watched this report in real estate there is huge shortage of workers or labour .can you explain this IFMS sector will be occupied this opportunity or not???

‘Labour Shortage Hits Indian Real Estate’, Says Sanjay Dutt, MD & CEO, Tata Realty | Business News