CSB Bank shares marginally in red despite robust Q1 numbers

Shares of CSB Bank dropped 0.43 percent in early trade on July 21, post robust Q1 results. At 9:29 am the CSB Bank stock was trading 0.38 percent lower at Rs 288.2 on BSE.

CSB Bank reported on July 20 a net profit of Rs 132 crore for the April-June FY24 quarter, 15.8 percent higher compared to Rs 114 crore in the corresponding quarter last year. The lender’s net interest income (NII) for the first quarter stood at Rs 364 crore with a Y-o-Y increase of 17 percent from Rs 311 crore.

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Gross non-performing asset (GNPA) of the bank stood at 1.27 percent, down from 1.79 percent recorded in the same quarter last year. Whereas, the net NPA (NNPA) of the lender for the quarter stood at 0.32 percent, declining from 0.60 percent on a year-on-year basis.

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The bank’s total deposits grew by 21 percent YoY and are at Rs 24,475 crores compared to Rs 20,267 crore correspondingly. The bank’s current account and savings account (CASA) book grew by 6 percent from Rs 7123 crore to Rs 7548 crore. The CASA ratio stood at 30.84 percent. Advances of the bank grew by 31 percent YoY to Rs 21,103 crore as supported by a robust growth of 42 percent in gold loans on YoY basis.

Segment wise advances

CSB Bank’s gold loan portfolio, a sector where the bank has a strong hold, grew by 42 percent to Rs 10,072 crore from Rs 7,107 crore. The bank retail portfolio, which grew by 41 percent, stood at Rs 3,155 crore from Rs 2,243 crore. Corporate portfolio saw 16 percent growth to Rs 6,191 crore from Rs 5,328 crore. Small, Medium enterprises (SME) saw a growth of 6 percent to Rs 2,527 crore from Rs 2,389 crore.

Brokerage Views

ICICI Direct has given a buy call on CSB Bank with a target price of Rs 330 in a report dated May 8, 2023. The brokerage house expects the bank to achieve this target in the next 12-18 months.

Stock Performance

CSB Bank stock has given a return of 11.27 percent over the last six months. Thus outperforming the benchmark Nifty Bank index which has given a return of 8.66 percent.

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