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Indian Bank extends rally post robust September-quarter results

The stock hit a record high of Rs 401, up 8%, extending its 17% gain in past six trading sessions

SI Reporter  |  Mumbai 

Brokers trade at their computer terminals at a stock brokerage firm in Mumbai (
Brokers trade at their computer terminals at a stock brokerage firm in Mumbai (

rallied 8% to Rs 401, extending its 17% gain in past six trading sessions, after the state-owned bank reported a good set of numbers for the quarter ended September 2017 (Q2FY18). had reported 12% rise in its net profit at Rs 452 crore in Q2FY18 against Rs 405 crore in the corresponding quarter of previous fiscal. Net interest income (interest income less interest expenditure) surged by 21% to Rs 1,544 crore from Rs 1,278 crore in a year ago quarter. The asset quality of the bank improved during the reporting quarter with the gross non-performing assets (NPAs) coming down to 6.67% of the gross advances in Q2FY18, as against 7.28% in Q2FY17. Net NPAs of bad loans too fell to 3.41% of the net advances at the end of second quarter this fiscal, from 4.62% in the year-ago corresponding period. According to analyst at Reliance Securities, continues to remain the best-managed public sector bank (PSB) on all major fronts.

Analysis of its stressed assets clearly suggests that it is approaching the end of recognition of stressed loan cycle, which along with higher PCR clearly indicates sharp moderation in credit cost from FY19 onwards. Further, strong revival in loan growth along with improvement in NIMs and other income suggests continued improvement in operating profit, going forward. Hence, we expect healthy traction in earnings to continue owing to robust growth in loan book, moderate credit cost and healthy margins, the brokerage firm said in a result update with ‘buy’ rating on stock with target price of Rs 445. trading at its all-time high level has rallied 49% from Rs 270, after the government announced the Rs 2.11 lakh crore recapitalization plan for public sector banks (PSBs). At 10:44 AM; the stock was up 7% at Rs 396 on the BSE, as compared to 0.35% rise in the S&P BSE Sensex. A combined 3.2 million shares changed hands on the counter on the BSE and NSE so far.

First Published: Thu, November 09 2017. 10:47 IST