Anand Rathi's research report on DCB Bank
Higher opex counterbalanced DCB Bank’s strong NII growth, keeping the C/I ratio above 60%; benign credit cost, however, aided profitability, with the RoA coming near ~1%. Higher slippages kept asset quality under pressure. Key positives for the quarter were 1) collection efficiency improving across key segments, 2) strong recoveries/upgrades, 3) decline in stress across core segments (excl. Corp.) and 4) strong traction in disbursements across key segments. With credit growth expected to pick up and normalising credit costs, earnings would improve.
Outlook
We retain our Buy rating, with a TP of Rs146, valuing the stock at 0.8x P/ABV on the FY25e book.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
