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Equitas Small Finance Bank has reported 19% growth in net profit at Rs 202.01 crore
for the quarter ended December 2023 (Q3FY2024). The bank has posted healthy 21%
growth in net interest income (NII), while the core fee income of the bank also
improved 24% in Q3FY2024. The Net Interest Margin (NIM) of the bank eased to 8.37%
in Q3FY2024 compared to 9.01% in the corresponding quarter of previous year.
On business front, the
bank as has posted 35% growth in business with strong 32% surge in loan book.
The asset quality of the bank weakened in Q3FY2024. Bank has reduced the credit
to deposit ratio to 101.2% at end December 2023 from 106.5% at end December
2022. CASA ratio of the bank dipped to 32.7% at end December 2023 from 46.2% at
end December 2022.
Asset quality moderates:
The bank has witnessed
moderation in asset quality in Q3FY2024.
The fresh slippages of
loans stood at Rs 312 crore in Q3FY2024 compared with 257 crore in previous
quarter and Rs 286 crore in the corresponding quarter last year.
The recoveries of NPAs
stood at Rs 69.77 crore, upgradations at Rs 102.71 crore and the write-off of
loans was at Rs 49.95 crore in Q3FY2024.
The standard
restructured loan book of the bank remained nil end December 2023.
Provision coverage ratio
was steady at 55.97% at end December 2023 compared to 57.72% a quarter ago and
50.84% a year ago.
The capital adequacy
ratio of the bank stood at 20.2% with Tier I ratio at 19.7% at end December
2023.
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Asset Quality
Indicators: Equitas Small Finance Bank
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|
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Dec/23
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Sep/23
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Jun/23
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Mar/23
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Dec/22
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Variation
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QoQ
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YTD
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YoY
|
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Gross NPA (Rs Crore)
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750.25
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660.50
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770.18
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723.96
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861.36
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14
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4
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-13
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Net NPA (Rs Crore)
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330.34
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279.29
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325.10
|
312.02
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423.44
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18
|
6
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-22
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% Gross NPA
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2.53
|
2.27
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2.75
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2.76
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3.63
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26
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-23
|
-110
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% Net NPA
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1.13
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0.97
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1.18
|
1.21
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1.82
|
16
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-8
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-69
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% PCR
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55.97
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57.72
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57.79
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56.90
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50.84
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-175
|
-93
|
513
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% CRAR - Basel III
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20.24
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21.33
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22.06
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23.80
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24.28
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-109
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-356
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-404
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% CRAR - Tier I -
Basel III
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19.69
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20.65
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21.36
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23.08
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23.74
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-96
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-339
|
-405
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Variation in basis
points for figures given in percentages and in % for figures in Rs crore
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Business Highlights:
Strong business growth: The business of the bank
has increased 35% YoY to Rs 65161 crore end December 2023, driven by 32% surge
in advances to Rs 32776 crore. Deposits rose 38% to Rs 32385 crore at end
December 2023.
CASA deposits ratio
declines: The
CASA deposits of the bank declined 2% YoY to Rs 10593 crore at end December
2023. The current account deposits increased 16% to Rs 921 crore, while saving
account deposits fell 3% to Rs 9672 crore end December 2023. The CASA ratio
declined to 32.7% at end December 2023 compared to 46.2% at end December 2022,
while eased from 33.6% a quarter ago.
The term deposits have
increased 73% to Rs 21792 crore end December 2023.
Strong loan growth: Advances growth was
driven by retail loans rising 36% YoY to Rs 18437 crore at end December 2023,
while credit to MSME jumped 28% to Rs 13452 crore at end December 2023. The
corporate credit rose 2% to Rs 887 crore end December 2023.
Investment book of the bank surged 37% YoY to Rs 8475 crore at end December 2023.
The SLR book increased 32% to Rs 7756 crore, while non-SLR book jumped 3324% to
Rs 719 crore at end December 2023.
Margins decline: The bank has showed 155
bps YoY jump in cost of deposits to 8.16%, while yield on advances increased 58
bps YoY to 17.59% in Q3FY2024. Thus, the NIM has declined 64 bps YoY to 8.37%.
Branch expansion: The bank has added 7
branches and 7 ATMs in Q3FY2024, taking overall tally to 963 branches and 363
ATM`s end December 2023.
Book value of the bank stood at Rs
50.5 per share at end December 2023, while the adjusted book value (net of
NNPA) was Rs 47.6 per share at end December 2023.
Quarterly Performance
NII rises on strong loan
growth: Bank
has recorded 34% increase in the interest earned at Rs 1428.80 crore, while
interest expenses increased 55% to Rs 643.65 crore in Q3FY2024. NII improved
21% to Rs 785.15 crore in the quarter ended December 2023.
Strong growth in the
core fee income: Bank has posted strong 24% growth in core fee income to Rs 118
crore, while the treasury income surged 275% to Rs 30 crore and other income jumped
54% to Rs 37 crore. The overall non-interest income increased 35% to Rs 205.48
crore in the quarter ended December 2023.
Expenses ratio improves:
The operating expenses
of the bank increased 21% to Rs 630.31 crore, as other expenses moved up 24% to
Rs 284.26 crore, while employee expenses increased 19% to Rs 346.05 crore in
Q3FY2024. Cost to income ratio improved to 63.6% in Q3FY2024 compared with
65.1% in Q3FY2023, helping the Operating Profit to increase 29% to Rs 360.32
crore.
Provisions and
contingencies jump: The bank has showed 69% surge in provisions to Rs 84.38 crore.
Effective tax rate rose to 26.8% in Q3FY2024 from 25.8% in Q3FY2023. Net Profit rose by 19%
YoY to Rs 202.01 crore during quarter ended December 2023.
Financial Performance
9MFY2024
Bank has posted 54%
increase in net profit to Rs 591.35 crore in the nine month ended December 2023
(9MFY2024). The net interest income increased 25% to Rs 2293.87 crore, while
non-interest income moved up 30% to Rs 558.22 crore, pushing up net total
income by 26% to Rs 2852.09 crore in 9MFY2024. The operating expenses increased
25% to Rs 1849.47 crore, while provision and contingencies declined 26% to Rs
207.64 crore, allowing profit before tax to increase 56% to Rs 794.98 crore in
9MFY2024. The cost-to-income ratio improved to 64.8% in 9MFY2024 compared to
65.2% in 9MFY2023. An effective tax rate rose to 25.6% in 9MFY2024 compared to
24.5% in 9MFY2023. The net profit has increased 54% to Rs 591.35 crore in
9MFY2024.
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Equitas Small Finance Bank:
Results
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Particulars
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2312 (3)
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2212 (3)
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Var %
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2312 (9)
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2212 (9)
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Var %
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2303 (12)
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2203 (12)
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Var %
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Interest Earned
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1428.80
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1063.39
|
34
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4041.75
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3006.15
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34
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4161.88
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3459.67
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20
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Interest Expended
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643.65
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415.89
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55
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1747.88
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1168.39
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50
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1617.15
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1421.13
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14
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Net Interest Income
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785.15
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647.50
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21
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2293.87
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1837.76
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25
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2544.73
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2038.54
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25
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Other Income
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205.48
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152.64
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35
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558.22
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430.89
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30
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669.59
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537.56
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25
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Net Total Income
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990.63
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800.14
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24
|
2852.09
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2268.65
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26
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3214.32
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2576.10
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25
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Operating Expenses
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630.31
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521.03
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21
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1849.47
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1479.04
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25
|
2038.31
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1704.15
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20
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Operating Profits
|
360.32
|
279.11
|
29
|
1002.62
|
789.61
|
27
|
1176.01
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871.95
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35
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Provisions &
Contingencies
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84.38
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49.90
|
69
|
207.64
|
281.60
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-26
|
407.20
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493.84
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-18
|
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Profit Before Tax
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275.94
|
229.21
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20
|
794.98
|
508.01
|
56
|
768.81
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378.11
|
103
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Provision for tax
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73.93
|
59.08
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25
|
203.63
|
124.46
|
64
|
195.21
|
97.38
|
100
|
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PAT
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202.01
|
170.13
|
19
|
591.35
|
383.55
|
54
|
573.60
|
280.73
|
104
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EPS*(Rs)
|
7.1
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6.0
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7.0
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4.5
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|
5.1
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2.5
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Adj BV (Rs)
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47.6
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33.2
|
|
47.6
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33.2
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|
43.6
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29.1
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* Annualized on current equity of
Rs 1132.28 crore. Face Value: Rs 10, Figures in Rs crore
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Source: Capitaline Corporate
Database
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