February 27, 2017 / 10:47 IST
Q3FY17 PAT at Rs 19.5 bn (up 23.3% YoY) was higher than our estimate primarily due to lower provisions (down 75% YoY on favourable base) and higher translation/actual exchange gain on forex borrowings. Asset quality improved with absolute GNPAs down by 4% QoQ and GNPA ratio down by 14 bps QoQ at 3.07%. Margin declined 13 bps QoQ at 4.74%.
Outlook
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Factoring in current result, we have cut our NNPA estimate which increases FY17E/FY18E ABV by 8%/6%. Our revised TP of Rs 155 (1.1x FY18E P/ABV; vs. Rs 135 earlier) implies 16% upside from CMP of Rs 134. We maintain BUY rating on the stock primarily on valuation comfort (0.9x FY18E; P/ABV of Rs 142).
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