Wednesday, June 29, 2011




Annual Reports of companies provide in-depth info about the Industry and the company. They also provide insights into future potential of the company.

Dena Bank’s Annual report for FY 2011 is now at hand and its salient points are presented below.

Banking Sector :

Non-food credit Growth has been above 20%.

Credit growth has been 21.38% and Deposit Growth has been 15.84%. Credit growth has been much more than Deposit Growth in percentage terms in FY 2011. Banks therefore raised Deposit rates significantly to attract more deposits. Lending rates have also been increased.

Performance of Dena Bank :

Business Mix has crossed the LAND MARK figure of Rs.1 lakh crores and  increased from Rs.87066.36 cr to Rs.1,09,372.99 cr by end of FY 2011 – a Growth of 25.62%

Total Deposits have grown to Rs.64209.62 cr  in FY 11 from Rs.51344.28 cr in FY 10 – a growth of 25.05%.

Total Advances have grown from Rs.35721.41 cr  in FY 10   to  Rs.45163.37 cr   in FY 11 – a growth of 26.42%.

CASA increased by 24.15% in FY 11 compared to  increase of 23.01% in FY 10. In absolute terms, it increased by  Rs.4424 cr.

Total Income increased by Rs.968.38 cr (21.06%) and stood at Rs.5567.37 cr – compared to Rs.4598.99 cr in FY 10.

Interest income increased to Rs.5033.53 Cr in FY 11 ( 25.51%).

Net Interest Income increased substantially by 60.3% and stood at Rs.1763.37 cr – compared to Rs.1100.03cr in FY 10.

Fee Based Income increased by 21.21% from Rs.309.58 cr in FY 10 to Rs.375.25 cr in FY 11.


OPT increased to Rs.1223.79 cr in FY 11 from Rs.840.58 cr in FY 10 –an  increase of 45.59%.

Net Profit has increased from Rs.511.25 cr in FY 10 to Rs.611.63 cr in FY 11 – after providing for the  pension liability  of retired and serving employees as required by the rules.(Rs.206.42 cr)- an increase of 19.63%.

Dividend has been enhanced from 20% last year to 22% in current year.


Gross NPA Ratio increased marginally to 1.86% in FY 11 from 1.80%  in FY 10.

Net NPA Ratio stood at 1.22% in FY 11 against 1.21% last year.

Provision Coverage Ratio stood at 74.62% -well above the required 70%.

The Bank had an all time HIGH recovery of Rs.134.58 cr from its  written-off accounts


Dena Bank allotted 4.65 cr Equity shares of FV Rs.10 at a Price of Rs.115.75 (Including a premium of Rs.105.75 )aggregating Rs.539 cr, to Govt of India on preferential basis. With this. Govt’s holding increased from 51.19% to 58.01%.

The CRAR (capital to Risk Asset ratio) is 13.41% now compared to 12.77% last year – against the requirement of 9%.

Net Worth of Dena Bank is Rs.3366.43 cr in FY 11 compared to Rs.2201.64 cr in FY 10., a growth of Rs.1164.79 cr ( 52.91%).


68 New Branches were opened in FY 11.Total now is 1291 Branches – all under CBS.
It has 496 ATMs now.

Net Interest Margin has increased from 2.61% in FY 10 to 3.17% in FY 11.

Return on Assets has decreased very marginally from 1.01% in FY 10 to 1.00% in FY 11.

Cost to Income Ratio has come down from 50.22% to 47.73%

CRAR under BASEL II has increased from 12.77% to 13.41%

Cost of Deposit has come down from 6.21 5 to 5.76%

Cost of funds has decreased from 6.31% to 5.87%.

Yield on Advances has come down from 10.32 to 10.24.

Yield on Fund has increased from 8.47 to 8.62

Return on Equity  has increased from 23.55% to 26.71%

Earnings Per share has gone up from Rs.17.83 to Rs.21.26 on a Face value of Rs.10

Book Value has gone up from 84.04 to 123.85.

Our Assessment :

Dena Bank is a very stable Bank and is progressing at a very fast pace. The Government has infused funds at the price of Rs.115.75, which is actually the real worth of the Dena Bank.  But the current market price is hardly Rs.89.

The EPS has been recording healthy increase with every quarter in the past. In Q4 FY 11, the Paid-up Equity has increased to Rs.333.39 from Rs.286.82 cr existing in Q3 FY 11. On this enhanced Equity, the annual EPS for FY 11 comes to Rs.21.26.

With the increase in equity at a good premium through funds from the GOI – we can expect the bank to clock very good business mix in Q1 FY 12 onwards and achieve very good net profits and EPS from current quarter onwards. Even on this EPS, the current price earnings ratio is hardly 4 – which is very low for this progressive bank. The GOI’s assessment of  Rs.115.75 as the Fair price for Dena Bank – is  quite appropriate at current EPS levels.

PS : The Bank’s Results were earlier reviewed at :

Readers can see the same also.

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