Indian Bank dips on weak Q3 earnings

Q3 gross and net NPA levels jumped up sequentially by 60.6% and 70.0%, respectively, on an absolute basis.

Indian Bank has dipped 4.4% to Rs 194 in otherwise firm market after reporting 37% year-on-year (yoy)drop in net profit at Rs 331 crore for the third quarter ended December 31, 2012 (Q2) due to higher provisioning for bad loans.

“Provisioning expenses for the bank increased by 74.3% yoy at Rs 412 crore and hence earnings at profit before tax level declined by 50.2% yoy at R 336 crore,” the state-owned bank said in a statement.

Indian Bank's total income however, went up by 8% to Rs 3,787 crore during the third quarter from Rs 3,505 crore earned during the quarter ended December 31, 2011.

 

“On the asset quality front, the bank witnessed substantial deterioration quarter-on-quarter, as gross and net NPA (non performing assets) levels jumped up sequentially by 60.6% and 70.0%, respectively, on an absolute basis,” according to analyst at Angel Broking.

The stock opened at Rs 197 and hit a low of Rs 186 on NSE. A combined around 260,000 shares have changed hands on the counter so far on NSE and BSE.