Canara Bank in demand

Canara Bank jumped 5.60% to Rs 281 at 15:08 IST on BSE after the bank's chief R.K. Dubey told the media that he expects the bank's asset quality to improve by 20-30 basis points by March 2014.

Meanwhile, the BSE Sensex was up 344.93 points, or 1.64%, to 21,341.46.

On BSE, 3.71 lakh shares were traded in the counter compared with average volume of 2.82 lakh shares in the past one quarter.

The stock hit a high of Rs 281.75 and a low of Rs 271 so far during the day. The stock hit a 52-week high of Rs 550 on 14 January 2013. The stock hit a 52-week low of Rs 189.90 on 28 August 2013.

The stock had underperformed the market over the past one month till 6 December 2013, sliding 1.10% compared with the Sensex's 0.49% rise. The scrip had, however, outperformed the market in past one quarter, rising 29.58% as against Sensex's 8.96% rise.

The large-cap company has an equity capital of Rs 443 crore. Face value per share is Rs 10.

Canara Bank's Chairman and Managing Director R.K. Dubey said in an interview to a news agency that he expects the bank's asset quality to improve by 20-30 basis points by March 2014 on the back of the bank's focus on aggressive debt collections and better monitoring of performing accounts.

Canara Bank reported 5.3% fall in net profit to Rs 625.94 crore on 13.3% rise in total income to Rs 10427.48 crore in Q2 September 2013 over Q2 September 2012.

Canara Bank's asset quality improved during Q2 September 2013 from Q1 June 2013. Gross non performing assets (NPA) declined to 2.64% in Q2 September 2013 from 2.91% in Q1 June 2013, but rose marginally from 2.58% in Q2 September 2012. Net NPA ratio reduced to 2.3% in Q2 September 2013 from 2.48% in Q1 June 2013, but rose from 2.12% in Q2 September 2012.

Provisions and contingencies rose 60.06% to Rs 674.03 crore in Q2 September 2013 over Q2 September 2012. However, it declined 26.43% to Rs 674.03 crore in Q2 September 2013 over Q1 June 2013.

The bank's board of directors at its meeting held on 12 November 2013, approved the proposal of raising capital by way of preferential allotment of equity shares in favour of Government of India amounting to Rs 500 crore.

The Government of India (GoI) holds 67.72% stake in Canara Bank (as per the shareholding pattern as on 30 September 2013).

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