Monday, July 11, 2016

Will South Indian Bank Make a Big Move on Q1 Numbers?

Private sector lender South Indian Bank's stock today moved up by 1.11%, on the first trading day after Q1 results.

The bank has followed a good fiscal – FY’16 – with an excellent quarter, Q1 FY’17.

In almost every performance metric, Q1 has seen commendable growth, even while asset quality remained stable on a sequential basis.

On a YoY basis, deposits are up by nearly 11%, advances are up by over 8%, total business is up by nearly 10%, and most impressively, net profit is up by 46%.

During FY’16, net profit was up by almost 8.50%, and compared with most of its traditional private sector peers, it was a commendable performance in a difficult year. 

More than that, FY’16 performance was powered by an excellent last quarter (Q4) performance which saw profits jumping four-fold on a YoY basis.

Now, SIB has followed up that performance with an impressive Q1 on overall basis.

The private sector lender also consistently excels in certain core metrics like Dividend Yield, Return on Asset, Respect for Equity, and FII / DII Holding.

During the 5 years between 2009 and 2014, SIB stock was an excellent wealth creator, multiplying in value by nearly 8 times.

Based on recent performances in Q4 & Q1, the stock will attempt to regain its momentum, and it’s low valuation by P/BV makes it attractive.

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