SouthIndianBank 2QFY2013RU NW

2QFY2013 Result Update | Banking
October 22, 2012
South Indian Bank

Performance Highlights
ACCUMULATE
CMP Target Price
% chg (qoq) 0.3 (3.8) (21.0) 2QFY12 259 166 95 % chg (yoy) 15.1 20.0 2.3
`22 `25 12 months
Particulars (` cr) NII Pre-prov. profit PAT
2QFY13 298 200 97
1QFY13 297 207 123
Investment Period
Stock Info Sector Market Cap (` cr) Beta 52 Week High / Low Avg. Daily Volume Face Value (`) BSE Sensex Nifty Reuters Code Bloomberg Code
Source: Company, Angel Research
Banking 2,972 0.9 28/20 243,699 1 18,793 5,717 SIBK.BO SIB@IN
For 2QFY2013, South Indian Bank (SIB) reported a muted net profit growth of 2.3% yoy (down 21.0% qoq) to `97cr, which is lower than our as well as the streets estimates. This is on account of higher provisioning expenses due to a large government account (NAFED, `150cr) slipping during the quarter and due to employee related fraud worth `32cr. Adjusting for interest reversal on NAFED (`20cr) and interest on income tax refund (`15cr), the pre-provisioning profit was however, in line with our estimates. We maintain our Accumulate rating on the stock. Asset quality deteriorates qoq: Slippages mostly one-offs: For 2QFY2013, the banks business growth remained healthy, with advances growing by 20.6% yoy and deposits growing by 16.5% yoy. The reported NIM as of 1HFY2013 stood at 3.1%, lower than 3.2% reported for 1QFY2013. The fee income of the bank reported a strong growth of 69.8% yoy during 2QFY2013, primarily driven by a 39.1% yoy growth in commission, exchange and brokerage (CEB) income and due to interest on income tax refund of `15cr (classified as non-interest income). The asset quality of the bank surprised negatively in 2QFY2013, with slippages increasing to `235cr (annualised slippage ratio of 3.5%) compared to `91cr in 1QFY2013. The rise in slippages during 2QFY2013 can be primarily attributed to a major government account (NAFED, exposure of `150cr) slipping during the quarter. Also, there was an employee related fraud worth `34cr (`2cr recovered) during the quarter which added on the NPA levels. Outlook and valuation: The banks asset quality which had held up pretty well till now in spite of the macro headwinds (which have led to higher provisioning expenses for most banks) has started to witness signs of pressure. Although, the high slippages in 2QFY2013 were mostly one-off in nature and most of the amount is expected to be recovered entirely before FY2013 end, aggressive yields (~12.8%) on non-gold loan portfolio however could lead to stress on the balance sheet and provide downside risk to the banks RoA. Having said that, the stock has been an underperformer compared to peers since the start of FY2013 and at FY2014E P/ABV of 1.0x and expected FY2014 RoA of 1.0%, we believe there is some room for upside in the stock. Hence we recommend an Accumulate rating on the stock.
Shareholding Pattern (%) Promoters MF / Banks / Indian Fls FII / NRIs / OCBs Indian Public / Others 13.0 47.8 39.2
Abs. (%) Sensex SIB
3m 9.6 (6.3)
1yr 12.0 (3.5)
3yr 11.9 56.7
Key financials (standalone)

Particulars (` cr) NII % chg Net profit % chg NIM (%) EPS (`) P/E (x) P/ABV (x) RoA (%) RoE (%)
FY2011 791 39.2 293 25.1 2.8 2.6 8.6 1.5 1.0 18.5
FY2012 1,022 29.2 402 37.3 2.9 3.5 6.3 1.3 1.1 21.6
FY2013E 1,251 22.5 464 15.5 2.8 3.5 6.4 1.1 1.0 19.1
FY2014E 1,438 14.9 514 10.7 2.7 3.8 5.8 0.9 0.9 16.9
Vaibhav Agrawal
022 3935 7800 Ext: 6808 vaibhav.agrawal@angelbroking.com
Varun Varma
022 3935 7800 Ext: 6847 varun.varma@angelbroking.com
Sourabh Taparia
022 3935 7800 Ext: 6872 sourabh.taparia@angelbroking.com
Please refer to important disclosures at the end of this report
South Indian Bank | 2QFY2013 Result Update
Exhibit 1: 2QFY2013 performance (standalone)

Particulars (` cr) Interest earned - on Advances / Bills - on investments - on balance with RBI & others Interest Expended Net Interest Income Other income Other income excl. treasury - Fee Income - Treasury Income - Others Operating income Operating expenses - Employee expenses - Other Opex Pre-provision Profit Provisions & Contingencies - Provisions for NPAs - Provisions for Investments - Provisions for Standard Assets - Other Provisions PBT Provision for Tax PAT Effective Tax Rate (%)
2QFY13 1,072 851 185 36 774 298 73 62 59 11 3 371 171 101 69 200 56 55 5 (4) 144 47 97 32.4
1QFY13 1,069 858 181 30 773 297 75 55 46 20 9 372 164 100 64 207 25 20 2 3 182 59 123 32.4
% chg (qoq) 0.2 (0.8) 1.8 20.4 0.2 0.3 (2.9) 12.8 29.2 (46.0) (70.8) (0.3) 4.0 1.3 8.4 (3.8) 120.4 179.4 111.1 (21.1) (21.2) (21.0) (5)bp
2QFY12 877 702 152 24 618 259 53 42 35 11 7 312 146 88 58 166 24 5 11 7 1 143 48 95 33.4
% chg (yoy) 1HFY2013 1HFY2012 22.2 21.2 21.8 51.7 25.1 15.1 37.2 48.5 69.8 (4.6) (61.3) 18.8 17.5 15.7 20.2 20.0 134.8 1,053.5 (100.0) (33.2) 0.8 (2.2) 2.3 (99)bp 2,141 1,709 366 66 1,547 595 148 117 21 31 96 742 335 202 134 407 81 74 7 (0) 326 106 220 32.4 1,646 1,312 296 39 1,182 464 105 78 16 26 63 568 259 157 102 309 45 7 15 21 1 265 87 177 33.0
% chg (yoy) 30.1 30.3 23.8 71.8 30.8 28.2 41.2 49.1 32.4 17.4 53.4 30.6 29.4 28.6 30.7 31.6 82.1 894.7 (100.0) (65.6) 23.0 20.9 24.1 (58)bp
Exhibit 2: 2QFY2013 Actual vs Angel estimates

Particulars (` cr) Net interest income Non-interest income Operating income Operating expenses Pre-prov. profit Provisions & cont. PBT Prov. for taxes PAT
Actual 298 73 371 171 200 56 144 47 97
Estimates 304 61 365 171 193 27 167 54 113
% chg (1.9) 19.2 1.6 (0.1) 3.2 110.2 (13.9) (14.0) (13.8)
October 22, 2012
Exhibit 3: 2QFY2013 performance analysis (standalone)

Particulars Balance sheet Advances (` cr) Deposits (` cr) Credit-to-Deposit Ratio (%) Current deposits (` cr) Saving deposits (` cr) CASA deposits (` cr) CASA ratio (%) CAR (%) Tier 1 CAR (%) Profitability Ratios (%) Cost of deposits# Yield on advances# Reported NIM Asset quality Gross NPAs (` cr) Gross NPAs (%) Net NPAs (` cr) Net NPAs (%) Provision Coverage Ratio (%) Slippage ratio (%) Loan loss provision to avg. assets (%) 496 1.7 242 0.9 51.2 3.4 0.5 295 1.1 95 0.4 67.7 1.8 0.2 68.2 66bp 154.2 51bp (1650)bp 167bp 33bp 231 1.0 58 0.3 74.7 0.5 0.1 115.1 75bp 314.8 61bp (2349)bp 291bp 47bp
#
2QFY13 28,156 38,490 73.2 1,362 6,321 7,683 20.0 14.4 12.3 8.3 12.8 3.1 46.1
1QFY13 % chg (qoq) 2QFY12 % chg (yoy) 27,349 37,153 73.6 1,445 6,390 7,835 21.1 13.2 10.9 8.4 13.0 3.2 44.2 2.9 3.6 (46)bp (5.7) (1.1) (1.9) (113)bp 127bp 142bp (11)bp (25)bp (6)bp 194bp 23,348 33,038 70.7 1,274 5,764 7,038 21.3 13.5 10.8 7.7 12.1 3.0 46.7 20.6 16.5 248bp 6.9 9.7 9.2 (134)bp 95bp 152bp 64bp 65bp 12bp (54)bp
Cost-to-income ratio
Source: Company, Angel Research; Note# : On a cumulative basis
Margins lower for 1HFY2013

For 2QFY2013, the banks business growth remained healthy, with advances growing by 20.6% yoy and deposits growing by 16.5% yoy. The growth in current account - savings account (CASA) deposits was moderate with current account deposits growing by 6.9% yoy and savings account deposits growing by 9.7% yoy. The bank has been seeing weakness in its NRE savings account franchise since the de-regulation in the NRE-TD rates. The NRE-SB deposits decreased by 10.7% qoq during 2QFY2013 and since the de-regulation (3QFY2012), have declined by 19.0% on an absolute basis. While the cost of deposits has increased on account of upward re-pricing of NRE-TD and flight of NRE-SB to NRE-TD, the bank has been able to increase its yields on loans, thereby protecting its NIMs. A large government account slipped during the quarter (NAFED, exposure of `150cr) on which the bank had to take an interest reversal of `20cr. The bank also received interest on income tax refund worth `15cr. However, the bank classified the interest income from income tax refund under other income. The reported NIM as of 1HFY2013 stood at 3.1%, lower than 3.2% reported for 1QFY2013. The cost of deposits for 1HFY2013 stood at 8.3% (8.4% for 1QFY2013), while yield on advances for 1HFY2013 stood at 12.8% (13.0% for 1QFY2013).
October 22, 2012
Exhibit 4: NRI Deposit breakup

Deposit type (` cr) NRE SB NRO SB FCNR (B) +RFC LOW COST TERM DEPOSIT LOW COST NRI DEPOSIT (SUB TOTAL) HIGH COST NRE TERM DEPOSIT NRO TERM DEPOSIT TOTAL NRI DEPOSIT
30-Sep-12 1,372 207 333 128 2,040 2,978 661 5,680
30-Jun-12 1,536 200 400 100 2,236 2,232 932 5,400
31-Mar-12 1,358 188 411 348 2,306 1,036 1,275 4,617
31-Dec-11 1,693 173 459 831 3,158 1,299 4,457
The banks overall priority sector lending stands at `5,000cr compared to the regulatory requirement of `10,000cr, leading to a significant shortfall of `5,000cr. The yields on Rural Infrastructure Development Fund (RIDF) are on the lower end and SIB could face margin pressures if they are not able to increase their priority sector lending over 2HFY2013. The gold loan portfolio of the bank declined on a qoq basis and now stands at ~`6,300cr (~22% of the overall loan book). The management has guided for a credit growth of 25% for FY2013.
Exhibit 5: Advances growth remains above system

Advances yoy growth (%,) 35.0 30.0 25.0 20.0 15.0 Deposits yoy growth (%)
Exhibit 6: CASA ratio* witnesses uptick qoq

(%)
24.0 21.3 21.0 18.0 15.0 12.0 21.5 19.7 21.1 20.0
31.8
31.8
30.6
25.4
33.1
22.8
23.5
17.5
5.0 -
20.6
16.5
10.0
2QFY12
3QFY12
4QFY12
1QFY13
2QFY13
2QFY12
3QFY12
4QFY12
1QFY13
2QFY13
Source: Company, Angel Research; Note* : Excluding FCNR, RFC
Exhibit 7: NIM trends*

(%) 3.3 3.1 2.9 3.1 3.0 3.1 3.2 3.1
Exhibit 8: Trend in yield on advances*

(%) 13.5 12.5 11.5 10.5 12.1 12.3 12.5 13.0 12.8
2.7 2.5 1HFY12 9MFY12 FY2012 1QFY13 1HFY13
9.5 8.5 1HFY12 9MFY12 FY2012 1QFY13 1HFY13
Source: Company, Angel Research; Note* On cumulative basis
Source: Company, Angel Research; Note* On cumulative basis
October 22, 2012
Strong performance on CEB front and interest on income tax refund boosts other income
The fee income of the bank reported a strong growth of 69.8% yoy during 2QFY2013, primarily driven by 39.1% yoy growth in CEB income and due to interest on income tax refund of `15cr (classified into other income). The forex income came in at a weak `3cr, while treasury income remained flat yoy at `11cr.
Exhibit 9: Break-up of non-interest income

Particulars (` cr) Fee income Treasury gains Profit on exchange transactions Non-interest income Excluding treasury 2QFY13 1QFY13 % chg (qoq) 2QFY12 % chg (yoy) 59* 11 3 73 62 46 20 9 75 55 29.2 (46.0) (70.9) (2.9) 12.8 35 11 7 53 42 69.8 (4.6) (61.4) 37.2 48.5
Source: Company, Angel Research; Note*includes `15cr of interest on income tax refund
Slippages mostly one-offs

The asset quality of the bank surprised negatively in 2QFY2013, with slippages increasing to `235cr (annualised slippage ratio of 3.5%) compared to `91cr in 1QFY2013. The rise in slippages during 2QFY2013 can be primarily attributed to a major government account (NAFED, exposure of `150cr) slipping during the quarter. Also, there was an employee related fraud worth `34cr (`2cr recovered) during the quarter which added on the NPA levels. The management is already in talks with NAFED and is confident of a near-full recovery before the year-end (some haircut would have to be taken). For the employee related fraud, the bank already has collateral of `10cr while another `10cr is expected to be retrieved via insurance. Hence, according to the management the maximum loss from the fraud is expected to be not more than `10cr. As a result of higher slippages, the banks gross NPA levels increased by 68.2% qoq, while net NPA levels more than doubled sequentially during the quarter. Also the banks provisioning coverage ratio declined sharply by 1,650bps to 51.2%. The bank restructured ~`71cr worth of accounts (taking the total restructuring book to `1,293cr). The bank does not have any major restructuring in pipeline currently, but the management remains wary of any incremental additions to the restructuring book.
October 22, 2012
Exhibit 10: Asset quality deteriorates

Gross NPAs (` cr) 525 450 375 300 225 150 51.2 74.7 75.2 71.4 67.7 Net NPA (` cr) PCR (%, RHS) 80.0 75.0 70.0 65.0 60.0 55.0 50.0 45.0 2QFY12 3QFY12 4QFY12 1QFY13 2QFY13
Exhibit 11: Slippages mostly one-offs

(%) 1.5 1.2 0.9 0.6 0.3 2QFY12 3QFY12 4QFY12 1QFY13 2QFY13 0.5 1.3 1.3
0.7
231
234
267
295
496
58
58
77
95
75
242
Exhibit 12: Opex to average asset trends

(%) 2.5 2.1 2.0 1.5 1.0 0.5 2QFY12 3QFY12 4QFY12 1QFY13 2QFY13 1.6 1.6 1.6 1.6
Exhibit 13: Cost to income ratio trends

(% ) 54.0 48.0 42.0 36.0 30.0 2QFY12 3QFY12 4QFY12 1QFY13 2QFY13 46.7 46.3 46.1 55.6
44.2
Healthy capital adequacy

The bank raised `440cr of equity during the quarter through a qualified institutional placement (QIP). As a result, the banks capital adequacy ratio (CAR) increased at 14.4% (12.2% as of 1QFY2013) while tier-I ratio increased 12.3% (10.9% as of 1QFY2013). The bank is not planning to raise any more capital this year.
October 22, 2012
Exhibit 14: Trends in CAR

(%)
16.0 12.0 8.0 10.8 4.0 2QFY12 3QFY12 4QFY12 1QFY13 2QFY13 9.6 11.5 10.9 12.3 13.5 12.0 2.7 2.4 Tier-I CAR Tier-II CAR 14.0 2.5 13.2 2.3 14.4 2.1
Investment arguments
Strong business growth
The bank grew its advances and deposits at a strong rate of 33.1% and 22.8% yoy, respectively, in FY2012. The gold loan portfolio of the bank has increased at 60% CAGR over FY200912. The gold loan portfolio (`6,300cr as of 2QFY2013) now constitutes 22% of the overall loan book. The management indicated that they would like to maintain the gold loan portfolio at 22-25% levels of the overall loan book and hence would now increase focus on the corporate segment and to drive the banks loan book growth (guidance of ~25% growth for FY2013). The banks tier-1 ratio, post the capital raising (`440cr via QIP during 2QFY2013) stands at a healthy 12.3%, giving enough headroom for the bank to grow at a healthy pace going ahead.
NIMs likely to have peaked out

SIBs NIMs have been healthy despite its relatively lower CASA deposits due to increasing share of high-yielding gold loans. However, increasing competition in the gold loan space and entry of several players is likely to reduce the so-far above-average profitability of this segment going forward. Also, the RBIs recent move of deregulating interest rates on NRE deposits has diminished the competitive cost advantage of these deposits, in our view. The bank has managed the NIM impact by increasing its yield on advances, however continuing to rely on this strategy going forward is likely to have asset quality implications. Eventually, either on account of decline in NIMs or increase in asset quality pressures, we expect downside risks to the banks RoA.
Outlook and valuation

The banks asset quality which had held up pretty well until now in spite of the macro headwinds (which have led to higher provisioning expenses for most banks) has started to witness signs of pressure. Although, the high slippages in 2QFY2013 were mostly one-off in nature and most of the amount is expected to be recovered entirely before FY2013 end, aggressive yields (~12.8%) on non-gold loan
October 22, 2012
portfolio however could lead to stress on the balance sheet and provide downside risk to the banks RoA. Having said that, the stock has been an underperformer compared to peers since the start of FY2013 and at FY2014E P/ABV of 1.0x and expected FY2014 RoA of 1.0%, we believe there is some room for upside in the stock. Hence we recommend an Accumulate rating on the stock.
Exhibit 15: Key assumptions

Particulars (%) Credit growth Deposit growth CASA ratio NIMs Other income growth Growth in staff expenses Growth in other expenses Slippages Coverage ratio
Earlier estimates FY2013 20.0 20.0 18.6 2.9 15.0 18.0 18.0 1.3 66.2 FY2014 20.0 20.0 17.1 2.8 13.4 18.0 18.0 1.3 67.1
Revised estimates FY2013 23.0 23.0 18.1 2.8 23.3 18.0 18.0 2.0 63.1 FY2014 20.0 20.0 16.7 2.7 2.4 16.0 16.0 1.2 59.7
Exhibit 16: Change in estimates

Particulars (` cr) NII Non-interest income Operating income Operating expenses Pre-prov. profit Provisions & cont. PBT Prov. for taxes PAT
Source: Angel Research
FY2013 Earlier Revised Var. (%) estimates estimates

1,251 284 1,535 728 807 106 700 227 473 1,251 305 1,556 728 827 141 687 223 464 0.0 7.2 1.3 2.5 32.2 (2.0) (2.0) (2.0)
FY2014 Revised Earlier estimates estimates

1,438 322 1,760 860 901 128 773 251 522 1,438 312 1,750 845 905 145 760 247 514
Var. (%)
0.0 (3.2) (0.6) (1.7) 0.5 13.1 (1.6) (1.6) (1.6)
October 22, 2012
Exhibit 17: P/ABV band

Price (`) 40 35 30 25 20 15 10 5 0
Dec-07 Aug-09 Mar-09 Nov-10 May-08 Dec-12 Apr-06 Apr-11 Jul-07 Feb-07 Oct-08 Sep-06 Sep-11 Feb-12 Jan-10 Jun-10 Jul-12
0.5x
0.8x
1.1x
1.4x
1.7x
October 22, 2012
Exhibit 18: Recommendation summary

Company Reco. AxisBk FedBk HDFCBk ICICIBk* SIB YesBk AllBk AndhBk BOB BOI BOM CanBk CentBk CorpBk DenaBk IDBI# IndBk IOB J&KBk OBC PNB SBI* SynBk UcoBk UnionBk UtdBk VijBk Accumulate Neutral Neutral Buy Accumulate Buy Reduce Sell Accumulate Accumulate Neutral Neutral Neutral Accumulate Neutral Accumulate Neutral Accumulate Neutral Neutral Buy Neutral Neutral Neutral Accumulate Buy Neutral CMP (`) 1,221 487 639 1,074 22 387 143 115 783 301 50 449 74 410 110 98 184 80 1,135 289 820 2,242 122 78 209 68 57 Tgt. price (`) 1,328 1,245 25 452 131 97 864 340 447 112 87 966 226 81 Upside (%) 9 16 11.0 17 (8) (15) 10 13 9 14 8 18 9 19 FY2014E FY2014E FY2014E FY2012-14E FY2014E P/ABV Tgt P/ABV (x) P/E (x) EPS CAGR (%) RoA (%) (x) 1.7 1.2 3.6 1.7 0.9 2.0 0.6 0.7 0.9 0.7 0.6 0.8 0.7 0.7 0.7 0.6 0.7 0.5 1.0 0.6 0.8 1.4 0.7 0.8 0.7 0.5 0.7 1.8 2.0 1.1 2.3 0.5 0.6 1.0 0.8 0.7 0.7 0.6 1.0 0.8 0.6 #
FY2014E RoE (%) 20.2 13.5 22.0 15.5 16.9 23.6 15.7 15.3 17.2 16.3 15.5 15.3 14.7 15.1 15.9 14.4 16.3 13.6 17.7 13.9 17.3 17.7 16.8 14.4 16.3 16.2 13.0
8.8 9.3 17.7 13.1 5.8 9.2 3.9 4.7 5.6 4.4 4.3 5.3 3.5 4.0 4.5 4.3 4.4 3.8 6.0 4.6 4.9 8.7 4.5 4.7 4.5 3.1 5.0
16.0 7.5 27.9 20.9 4.2 23.5 (0.4) 1.0 7.1 20.8 35.5 7.2 100.1 (2.2) 3.1 20.1 2.5 27.1 6.5 26.5 7.4 21.7 11.7 7.9 19.8 20.7 12.1
1.6 1.1 1.9 1.4 0.9 1.5 0.9 0.9 1.0 0.8 0.7 0.9 0.6 0.8 0.8 0.9 1.1 0.6 1.3 0.9 1.0 1.0 0.7 0.6 0.8 0.7 0.5
Source: Company, Angel Research; Note:*Target multiples=SOTP Target Price/ABV (including subsidiaries), Without adjusting for SASF
Company Background
South Indian Bank (SIB) is a small old generation private sector bank with ~84% of its branches in southern India (66% in Kerala alone). Like Federal Bank, SIB also has a large NRI customer base (13% of total deposits). Of late, the bank has aggressively started focusing on the gold loan portfolio - a highly profitable and secured loan segment. Gold loans accounted for ~23% of the bank's loan book as of FY2012.
October 22, 2012
10
Income statement (standalone)

Y/E March (` cr) Net Interest Income - YoY Growth (%) Other Income - YoY Growth (%) Operating Income - YoY Growth (%) Operating Expenses - YoY Growth (%) Pre - Provision Profit - YoY Growth (%) Prov. and Cont. - YoY Growth (%) Profit Before Tax - YoY Growth (%) Prov. for Taxation - as a % of PBT PAT - YoY Growth (%) FY08 394 7.2 143 17.3 537 9.7 248 13.4 289 6.8 57 (54.0) 232 58.3 80 34.6 152 45.6 FY09 523 32.7 164 15.2 687 28.0 328 32.4 359 24.3 57 0.7 301 30.0 107 35.4 195 28.4 FY10 568 8.7 208 26.9 777 13.0 366 11.5 411 14.5 43 (24.5) 367 21.9 134 36.4 234 20.0 FY11 791 39.2 197 (5.6) 988 27.2 463 26.3 525 27.9 80 84.4 446 21.3 153 34.3 293 25.1 FY12 1,022 29.2 247 25.6 1,269 28.4 617 33.5 652 24.0 79 (0.7) 572 28.5 171 29.8 402 37.3 FY13E 1,251 22.5 305 23.3 1,556 22.6 728 18.0 827 27.0 141 77.8 687 20.0 223 32.4 464 15.5 FY14E 1,438 14.9 312 2.4 1,750 12.5 845 16.0 905 9.4 145 2.8 760 10.7 247 32.4 514 10.7
Balance sheet (standalone)

Y/E March (` cr) Share Capital Reserve & Surplus Deposits - Growth (%) Borrowings Tier 2 Capital Other Liab. & Prov. Total Liabilities Cash balances Bank balances Investments Advances - Growth (%) Fixed Assets Other Assets Total Assets - Growth (%) FY08 90 1,071 23.8 28 155 590 974 729 4,572 32.0 113 249 25.2 FY09 113 1,191 19.4 257 155 571 998 1,038 6,075 13.3 136 284 19.2 FY10 113 1,372 27.2 1 330 706 1,391 597 7,156 33.6 153 415 25.3 FY11 113 1,734 29.2 25 265 962 1,828 638 8,924 29.5 357 585 28.5 FY12 113 2,057 22.8 323 265 1,111 1,572 1,069 9,400 33.1 378 671 23.0 FY13E 134 2,850 44,896 23.0 500 258 1,385 50,023 2,020 1,324 11,823 33,555 23.0 468 832 50,023 23.9 FY14E 134 3,255 53,875 20.0 598 252 1,681 59,794 2,155 1,583 14,237 40,266 20.0 559 994 59,794 19.5
15,156 18,092 23,012 29,721 36,501
17,090 20,379 25,534 32,820 40,370
10,454 11,848 15,823 20,489 27,281
17,090 20,379 25,534 32,820 40,370
October 22, 2012
11
Ratio Analysis (standalone)

Y/E March Profitability ratios (%) NIMs Cost to Income ratio RoA RoE B/S ratios (%) CASA ratio Credit/Deposit ratio Net worth/ Assets CAR - Tier I Asset Quality (%) Gross NPAs Net NPAs Slippages NPA prov / avg. assets Provision Coverage Per Share Data (`) EPS ABVPS (75% cover) DPS Valuation Ratios PER (x) P/ABVPS (x) Dividend Yield DuPont Analysis NII (-) Prov. Exp. Adj NII Treasury Int. Sens. Inc. Other Inc. Op. Inc. Opex PBT Taxes RoA Leverage RoE 2.6 0.4 2.2 0.2 2.4 0.7 3.1 1.6 1.5 0.5 1.0 16.6 16.4 2.8 0.3 2.5 0.2 2.7 0.7 3.4 1.8 1.6 0.6 1.0 15.4 16.0 2.5 0.2 2.3 0.3 2.6 0.6 3.2 1.6 1.6 0.6 1.0 16.7 17.0 2.7 0.3 2.4 0.1 2.6 0.5 3.1 1.6 1.5 0.5 1.0 18.4 18.5 2.8 0.2 2.6 0.1 2.7 0.6 3.3 1.7 1.6 0.5 1.1 19.7 21.6 2.8 0.3 2.5 0.1 2.5 0.6 3.1 1.6 1.5 0.5 1.0 18.6 19.1 2.6 0.3 2.4 0.0 2.4 0.5 2.9 1.5 1.4 0.4 0.9 18.1 16.9 13.3 1.8 1.3 12.9 2.1 1.3 10.8 1.7 1.8 8.6 1.5 2.2 6.3 1.3 2.7 6.4 1.1 2.7 5.8 0.9 3.1 1.7 12.6 0.3 1.7 10.8 0.3 2.1 12.9 0.4 2.6 15.0 0.5 3.5 17.8 0.6 3.5 20.8 0.6 3.8 23.5 0.7 1.8 0.3 0.7 0.1 82.0 2.2 1.1 1.6 0.1 48.4 1.3 0.4 1.5 0.2 70.8 1.1 0.3 0.7 0.1 73.9 1.0 0.3 0.8 0.1 71.4 1.4 0.5 2.0 0.2 63.1 1.6 0.7 1.2 0.2 59.7 24.1 69.0 16.6 13.8 12.1 23.8 65.5 15.4 14.8 13.2 23.1 68.8 16.7 15.4 12.4 21.5 68.9 18.4 14.0 11.3 19.7 74.7 19.7 14.0 11.5 18.1 74.7 18.6 15.3 13.2 16.7 74.7 18.1 14.5 12.6 FY08 FY09 FY10 FY11 FY12 FY13E FY14E
2.6 46.2 1.0 16.4
2.9 47.8 1.0 16.0
2.5 47.1 1.0 17.0
2.8 46.8 1.0 18.5
2.9 48.7 1.1 21.6
2.8 46.8 1.0 19.1
2.7 48.3 0.9 16.9
October 22, 2012
12
Research Team Tel: 022 - 39357800
E-mail: research@angelbroking.com
Website: www.angelbroking.com
DISCLAIMER
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and risks of such an investment. Angel Broking Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, make investment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in this document are those of the analyst, and the company may or may not subscribe to all the views expressed within. Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's fundamentals. The information in this document has been printed on the basis of publicly available information, internal data and other reliable sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this document is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. While Angel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory, compliance, or other reasons that prevent us from doing so. This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced, redistributed or passed on, directly or indirectly. Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in the past. Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in connection with the use of this information. Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please refer to the latest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Limited and its affiliates may have investment positions in the stocks recommended in this report.
Disclosure of Interest Statement 1. Analyst ownership of the stock 2. Angel and its Group companies ownership of the stock 3. Angel and its Group companies' Directors ownership of the stock 4. Broking relationship with company covered
South Indian Bank No No No No
Note: We have not considered any Exposure below ` 1 lakh for Angel, its Group companies and Directors
Ratings (Returns):
Buy (> 15%) Reduce (-5% to 15%)
Accumulate (5% to 15%) Sell (< -15%)
Neutral (-5 to 5%)
October 22, 2012
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2QFY2013 Result Update | Banking

October 22, 2012