BoM Q1 results: Net up 46.64% to Rs 1,293 cr on healthy NII growth

Mulls to raise upto Rs 10,000 crore through Infrastructure bonds

Bank of Maharashtra (BoM)’s net profit during the June quarter (Q1FY25) grew 46.64 per cent year-on-year (Y-o-Y) to Rs 1,293 crore, mainly aided by a healthy rise in net interest income (NII). The public sector lender's stock closed 5.5 per cent higher at Rs 68.66 a share on BSE on Monday.

NII expanded 19.63 per cent to Rs 2,799 crore in Q1FY25 compared to Rs 2,340 crore in the same quarter a year ago. Net interest margin (NIM) improved to 3.97 per cent in Q1FY25 compared to 3.86 per cent in Q1FY24.

Nidhu Saxena, managing director and chief executive of BoM, said the bank expects NIMs to be around 3.75 per cent in FY25. The bank’s non-interest income has risen 42.16 per cent Y-o-Y to Rs 894 crore.

The lender’s provisions for non-performing assets (NPAs) rose marginally from Rs 539.07 crore in Q1FY24 to Rs 586.39 crore in Q1FY25. There was an increase in slippages from the agriculture loan portfolio in June quarter, Saxena said in a post-result virtual press meet. This pushed up the credit cost to 1.2 per cent in Q1FY25 from 0.9 per cent in March quarter of FY24. The bank has made additional provision for the stressed agriculture credit in Q1.

Advances grew 18.99 per cent Y-o-Y to Rs 2.09 trillion in Q1FY25. Retail advances grew by 18.26 per cent Y-o-Y to Rs 53,161 crore in the June quarter of FY24.

Total deposits increased 9.43 per cent Y-o-Y to Rs 2.67 trillion. The share of low-cost deposits — current account and saving account (CASA) — declined to 49.86 per cent at the end of June 2024 from 50.97 per cent a year ago.

The credit deposit ratio (C\D Ratio) of the bank stood at 78.17 per cent in the June quarter of 2024, up from 71.89 per cent a year ago.

Saxena said the C\D ratio at 78.17 per cent was a healthy level and not a cause for concern. The bank was mindful of the gap between credit and deposit growth rate. It is stepping up efforts to mobilise deposits. It would raise up to Rs 10,000 crore through infrastructure bonds.

The asset quality profile improved with gross NPAs declining to 1.85 per cent in June 2024 from 2.28 per cent in June 2023. Net NPAs also declined from 0.20 per cent in June 2023 to 0.24 per cent in June 2024. The provision coverage ratio (PCR), including written-off accounts, stood at 98.36 per cent in June 2024 from 98.37 per cent in June 2023. The bank’s capital adequacy stood at 17.04 per cent, with tier-1 at 13.4 per cent at the end of June 2024.

The Pune-based lender has indicated equity offering in August\September 2024 as a part of efforts to bring down the Government of India’s stake from around 86.46 per cent now to 75 per cent.

Saxena said the size of equity offering will depend on market appetite and capital requirements. At the current market price, the bank would need to raise Rs 6,700 crore through equity offering. Of this, the public sector lender plans to raise about Rs 5,000 crore in the current financial year.