Perspective on Markets

By Saday Sinha, Vice President, Research, Kotak Securities:

Core performance came marginally ahead of our expectation. NII grew 15.2% on back of healthy margin (domestic NIM: 2.94%; 10bps improvement QoQ & YoY) while loan book grew 18.8% YoY. PAT came higher on back of lower provisions. Asset quality also remained healthy - GNPA and NNPA remained stable QoQ in absolute terms while in percentage terms, it inched up marginally to 3.11% and 1.58%, respectively. Fresh impairment came at Rs.28.7 bn (slippage: Rs.18.8 bn; restructuring: Rs.9.9 bn) as against the run-rate of Rs.32 bn during previous four quarters. Gross slippage at 1.9% is lower than its peers who have declared its results and hence it is positive for the stock. BoB remains one of the preferred stock in the PSU banking space.