Tuesday, December 20, 2011

CANARA BANK=Q2 FY 2012 RESULTS = QTR ENDING SEPT,2011 = HUGE PROVISIONS DUE TO MIGRATION TO SYSTEM BASED NPA RECOGNITION = ELSE, PERFORMANCE IS VERY GOOD


Canara Bank

NSE Symbol        CANBK

Results for
2nd QUARTER ENDING Sept,2011

The financial Results of Canara Bank for the 2nd quarter ending  Sept,2011 are analysed below :

Interest on Advances has gone up to Rs.5825.60 cr – up by 6.25% from Q1 FY 12 and up by 41.76% from Q2 FY 11.

Income on Investments     has increased to Rs.1729.99 cr – up by 5.91% from Q1 FY 12 and up by Rs.22.13% from Q2 FY 11.

Interest Earned    is Rs.7614.47 cr – up by  6.04% from Q1 FY 12; and up by Rs.36.52% from Q2 FY 11.

Other Income is Rs.828.26 cr – up by 57.21% from Q1 FY 12 and up by 65.78% from Q2 FY 11.

Total Income is Rs.8442.73 Cr – up by 9.54% from Q1 FY 12; and up by 38.93% from Q2 FY 11.

Interest Expended is Rs.      5652.78 Cr – up by 4.92% from Q1 FY 12; and up by 58.16% from Q2 FY 11.

Net Interest Income is Rs.1961.69 cr – up by 9.4% from Q1 FY 12; and down by (-)2.08% from Q2 FY 11.

Total Expenditure is Rs.6837.40 cr up by 6.22% from Q1 FY 11; and up by 46.68% from Q2 FY 11.

Operating Profit is Rs.1605.33 cr – up by 26.36% from Q1 FY 12 and up by 13.39% from Q2 FY11.

Provisions  has increased much to Rs.553.11 cr – up by 60.53% from Q1 FY 12; and Up by a huge 250.31% from Q2 FY 11.

Profit before tax stands at Rs.1052.22 Cr – up by 13.65% from Q1 FY 12; and down by (-)16.35% from Q2 FY 11. Higher Provisions have taken their toll on PBT which has comedown compared to Q2 FY 11.

Net Profit stands at Rs.852.22 cr – up by 17.41% from Q1 FY 12; and down by (-)15.44% from Q2 FY 11. Here also Higher provisions in Q2 FY 12 has brought down the NPT  - compared to Q2 FY 11.

Capital Adequacy Ratio is comfortable at 12.78.

% of Gross/Net NPA stands at      1.43 in Q2 FY 12;  1.34 in Q1 FY 12; and   1.06 in Q2 FY 11.

Return on Assets is reasonable at 1.01 in Q2 FY 12; 0.88 in Q1 FY 12; and 1.52 in Q2 FY 11.

Basic EPS on a FV of Rs.10 stands at Rs.19.24 in Q2 FY 12, compared to Rs.16.38 in Q1 FY 12 and Rs.24.58 in Q2 FY 11. Canara Bank is one of the efficient Banks with a good EPS.

At current levels of Q’ly EPS, Canara Bank may clock an Annualised EPS of around Rs.78. Its current Market price is Rs.361, while its 52 week High was Rs.671.70 and 52 week Low was Rs.360.10

At the current level, the PE Ratio works out to just 4.63. In a Normal market, Canara Bank is likely to scale beyond its 52 week High price. Next Q’ly result also can be expected to be better than Q2 FY 12 result, with lesser Provisions.

Major Highlights Q2FY12

Þ          Steady Growth in Business - Global business crosses Rs.5.30 lakh crore, an increase of 25% y.o.y. 
Þ          Global Deposits reached Rs.312577 crore, up by 25%.
Þ          Domestic deposits grew by 26% compared to SCBs’ growth at 19%.
Þ          Domestic advances grew higher by 27% compared to SCBs’ growth at 21.4%.
Þ          Record Cash Recovery at over Rs.800 crore.
Þ          160 Branches and 114 ATMs added during the Second Quarter.
Þ          System Driven NPA implemented for all loan accounts, irrespective size or category. 

·         CASA deposits was at Rs.80775 crore, constituting 26.7% of the domestic deposits.
·         Savings deposits rose by 17.9% y-o-y to Rs.64043 crore.  The Bank added over 14 lakhs SB clientele during Q2 of FY12, with the aid of special SB campaign and substantial mobilization of accounts by the newly opened branches.
·         Advances (net) grew by 23.8% to reach Rs.217938 crore, up from rupee symbol download, indian currency symbol176071 crore as at September 2010. Credit to deposit ratio stood at 69.7%.
·         The Bank’s domestic business constituted about 96% of the total business with 26% growth in domestic deposits and 27% growth in domestic net advances.
·         Steady improvement in business is well reflected in quarter after quarter increase in productivity of the Bank. While Business per Employee increased to Rs.12.98 crore, Business per Branch improved to rupee symbol download, indian currency symbol154.35 crore as at September 2011 compared to Rs.138.70 crore a year ago.
·         The Bank’s clientele base reached 4.04 crore, comprising 3.58 crore under deposit accounts and 46 lakhs under borrowal accounts.

Asset Quality
·         The Bank’s gross NPA ratio increased to 1.73% (Rs,3793 crore) compared to the gross NPA ratio of 1.49% (Rs.2636 crore) as at September 2010. 
·         The increase in NPAs was due to full migration to system based NPA recognition, irrespective of the size or category. 
·         Net NPA ratio stood at 1.43% (Rs.3117 crore) as at September 2011.
·         Cash recovery during the H1 of FY12 aggregated to a record Rs.1558 crore, higher than Rs.742 crore in the same period a year ago.  Cash Recovery for the Q2 was at Rs.808 crore.  

Goals for FY12
  • Aiming at a Total Business Growth of 20%
  • More than 300 branches during FY12
  • Taking the ATM strength to 3000.
  • Thrust on business process reengineering and further enhance productivity in the CBS environment.
  • Focus on growing Retail Business- Retail Deposits, Retail Advances  and Recovery
o   Plans to open Branches at QFC-Qatar and South Africa

FINANCIAL RESULTS IN A NUT SHELL
CANARA BANK
30-Sep-11
30-Jun-11
% DIF
30-Sep-10
%DIF
Interest on Advances
582560
548284
6.25
410956
41.76
Income on Investments
172999
163338
5.91
141652
22.13
Income on Balances With RBI
5879
6443
-8.75
5126
14.69
Others
9
10
-10
10
-10
Interest Earned
761447
718075
6.04
557744
36.52
Other Income
82826
52684
57.21
49962
65.78
Total Income
844273
770759
9.54
607706
38.93
Interest Expended
565278
538767
4.92
357414
58.16
NII
196169
179308
9.4
200330
-2.08
Employees Cost
76696
66768
14.87
72744
5.43
Other Operatng Expenses
41766
38184
9.38
35971
16.11
Operating Expenses
118462
104952
12.87
108715
8.97
Total Expenditure
683740
643719
6.22
466129
46.68
Operating Profit
160533
127040
26.36
141577
13.39
Provisions
55311
34455
60.53
15789
250.31
Profit before tax
105222
92585
13.65
125788
-16.35
Tax Expense
20000
20000
0
25000
-20
Net Profit
85222
72585
17.41
100788
-15.44
Face Value(Rs.)
10
10
0
10
0
Paid-up Equity Share Capital
44300
44300
0
41000
8.05
Capital Adequacy Ratio
12.78
13.37
-4.41
13.88
-7.93
Basic EPS
19.24
16.38
17.46
24.58
-21.72
 % of Gross/Net NPA
1.43
1.34
6.72
1.06
34.91
Return on Assets
1.01
0.88
14.77
1.52
-33.55
Public Holding (%)
32.28
32.28
0
26.83


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