Shares of Bank of India succumbed to selling pressure on Monday after the state-owned lender's deposit growth during the third quarter that ended on December 31, 2023, remained weak.
The stock settled 8.35% lower at ₹138.90 apiece on the NSE. Bank of India shares have gained nearly 23% since the beginning of this year, while it has rallied over 75% in the last one year.
Two out of four analysts tracking the PSU have a 'Buy' call on the stock, one recommends a 'Hold' and another suggests a 'Sell', according to data from Bloomberg. The 12 month average target price implies a potential downside of 3.4% from the current market levels.
The state-run bank's net profit jumped 62.42% to ₹1,869.51 crore on 15.9% rise in total income to ₹16,411.10 crore in this quarter over Q3 FY23.
The lender's net interest income or NII fell 2.36% on-year to ₹5,463 crore for Q3 FY23, compared to ₹5,596 crore for Q3 FY22. Net interest margin (NIM) (domestic) slipped to 3.21% in Q3 FY24 as compared to 3.72% in Q3 FY23.
In an exclusive conversation with CNBC-TV18, Rajneesh Karnatak, the managing director and chief executive officer (CEO) of Bank of India, said the growth in the CASA has been at around 11,000 in absolute terms, and the bank's CASA percentage is also healthy at 44%, retail term deposit with 44% and Bank of India having a very strong franchise for the deposits so only 12% of its total domestic deposit is bulk deposit and 88% of this is from the retail term deposit and the CASA.
"For this quarter also, we will be protecting our NIMs at the level which is there for the December quarter only because we are doing all our efforts to improve our CASA," Karnatak said.
Operating profit (before provisions and contingencies) declined 17.74% YoY to ₹3,003.94 crore in Q3 FY24.
Total provisions and contingencies (other than tax) dropped 73.33% to ₹501.11 crore in Q3 FY24 as against ₹1,878.98 crore in Q3 FY23.
Profit before tax in Q3 FY24 stood at ₹2,502.83 crore, up 41.17% on YoY basis.
The bank's gross non-performing assets (NPAs) slipped to ₹30,237.15 crore as on 31 December 2023 as against ₹38,884.61 crore as on 31 December 2022.
The ratio of gross NPAs was 5.35% as on 31 December 2023 as against 7.66% as of 31 December 2022. The ratio of net NPAs was 1.41% as on 31 December 2023, compared with 1.61% as on 31 December 2022.
Provision Coverage Ratio (PCR) stood at 89.95% as on 31 December 2023 as against 90.27% as on 31 December 2022.
Slippage ratio improved to 0.24% in Q3 FY24 as against 0.27% in Q3 FY23.
While bank's deposits (domestic) increased by 7.62% YoY to ₹5,99,137 crore, advances (domestic) jumped by 11.34 % YoY to ₹4,75,012 crore as on 31 December 2023.
The bank's CASA (domestic) rose by 5.92% YoY to ₹2,61,335 crore while CASA Ratio stood at 44.56% as of December 2023.
As on 31 December 2023, the bank's total capital adequacy ratio (CRAR) was at 16.06% while CET -1 ratio stood at 13.16%.
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