Earnings Outlook
Lower provisions to aid Karur Vysya Bank's PAT
This story was originally published at 17:20 IST on 16 July 2024
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NEW DELHI – Karur Vysya Bank's net profit is seen rising from a year ago to 3.98-4.41 bln rupees for the quarter ended June on the back of lower provisions and steady loan growth, according to estimates of three brokerages. The bank reported a net profit of 3.59 bln rupees a year ago and 4.56 bln rupees in the previous quarter.
Karur Vysya Bank is scheduled to announce its earnings for the June quarter on Thursday.
The Tamil Nadu-based private bank's advances rose 16.1% from a year ago to 777.09 bln rupees as of Jun 30, as per the provisional figures detailed by the bank.
"Despite some margin contraction, we expect the bank to clock 1.6% RoA (return on assets) led by contained opex (operating expenses) and provisions, whereas slippages are likely to remain range bound," Emkay Global Financial Services said in a pre-earnings report.
In Jan-Mar, the provisions and contingencies of the bank were stable on a year-on-year basis at 2.93 bln rupees.
Kotak Institutional Equities expects the bank's net interest margin to fall 14 basis points on year and 12 bps on quarter to 3.7% as of Jun 30 and said the margin contraction cycle is a near-term concern for the bank. Most banks are expected to post a fall in net interest margin in Apr-Jun due to a rise in borrowing costs amid tight liquidity conditions.
The bank's net interest income is seen in a range of 9.94-10.17 bln rupees in the quarter ended June, according to estimates of the three brokerages.
Today, shares of Karur Vysya Bank ended 1.1% higher at 202.05 rupees on the National Stock Exchange.
Following are the Apr-Jun earnings estimates of Karur Vysya Bank based on reports compiled by Informist from three brokerage houses:
| Brokerage firm | NII (in mln rupees) | Net Profit(in mln rupees) |
| Anand Rathi Share and Stock Brokers | 10,137 | 4.382 |
| Emkay Global Financial Services | 10,168 | 4,405 |
| Kotak Institutional Equities | 9,942 | 3,983 |
End
Reported by Pratiksha
Edited by Saji George Titus
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