Axis Securities's research report on Lakshmi VilasLakshmi Vilas Bank (LVB) reported a strong Q4PAT of Rs 491mn (up 22% YoY) led by healthy NII growth (+24% YoY) and lower provisions. Headline asset quality deteriorated marginally QoQ, with GNPLs rising to 1.97% in Q4 vs. 1.82% in Q3.Although operating expenses shot up during the quarter (+28% YoY), the management believes that it can bring cost-to-income ratio down to ~51%in near term (vs. 57% in FY16). The new MD & CEO, Mr. P. Mukherjee has etched out broad strategies for the bank’s future – CASA and retail business growth to be in focus by leveraging brand and strengthening branch network;emphasis on cards and digital channels. Nonetheless, we have been conservative with our estimates; hence, upside potential may emanate from successful execution of these strategies.For all recommendations, 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.
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