Reduce DCB Bank; target of Rs 78: Arihant Capital

Arihant Capital 's research report on DCB Bank

DCB Bank reported mixed performance during Q1FY21 as NII growth was low at 1% YoY, led by weak loan growth and softer NIM. It has reported 2% decline in profit at Rs 79 cr, due to higher provisions (+106% YoY). The Bank has provided Rs 32 cr towards Covid related contingencies and Rs 38 cr towards NPA provisions. Strong treasury gain (+139% YoY) and lower OPEX leading to operating profit growth of 15% YoY to Rs 191 cr. Moratorium book of the Bank declined to ~26% from 60% in phase 1.

Outlook

We maintain our Reduce rating with a revised target price of Rs 78.

For all recommendations report, click here

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