Canara Bank shares decline 2% despite 90% surge in Q4 net profit

Canara Bank

Shares of Canara Bank dropped 2 percent in early trade despite robust Q4 earnings. At 10:48am on Tuesday, the stock was trading down 1.23 percent at Rs 309.

The lender reported a net profit of Rs 3,175 crore, up 90 percent from Rs 1,666 crore last year, while net interest income (NII), or the difference between interest earned and interest expended, grew 23 percent to Rs 8,616 crore for the fourth quarter under review from Rs 7,006 crore a year back.

Its operating profit stood at Rs 7,252 crore during the March quarter, registering a growth of 17 percent YoY. Canara Bank improved its asset quality over the year-ago period as gross non-performing assets (GNPA) ratio reduced to 5.35 percent in the March quarter, down from 5.89 percent at the end of March 2022.

Net non-performing assets (NNPA) ratio declined to 1.73 percent as of March 2023 from 2.65 percent as of March 2022. The bank's provision coverage ratio (PCR) stood at 87.31 percent at the end of March quarter as against 84.17 percent in the last year quarter.

On the operational front, the global business increased by 12 percent YoY to Rs 20.41 lakh crore as at March 2023 with global deposits at Rs 11.79 lakh crore. Domestic deposits of the bank stood at Rs 10.94 lakh crore at the end of the quarter, showing a growth of 6 percent YoY.

While the retail lending portfolio increased by 11 percent YoY to Rs 1.4 lakh crore, housing loans jumped 14 percent YoY to Rs 84,364 crore. The lender's Board has recommended a dividend of Rs 12 per equity share (or, 120 percent) of face value of Rs 10 each to the shareholders for the financial year 2022-23. The lender has 9,706 branches as of the March quarter, out of which 3048 are rural, 2742 semi-urban, 1991 urban and 1925 metro along with 10726 ATMs.

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