{"id":158394,"date":"2024-02-02T10:07:31","date_gmt":"2024-02-02T15:07:31","guid":{"rendered":"https:\/\/44.250.171.167\/?p=158394"},"modified":"2024-02-02T10:07:32","modified_gmt":"2024-02-02T15:07:32","slug":"punjab-sind-bank-q3-fy24-earnings-conference-call-insights","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/punjab-sind-bank-q3-fy24-earnings-conference-call-insights\/","title":{"rendered":"Punjab &#038; Sind Bank Q3 FY24 Earnings Conference Call Insights"},"content":{"rendered":"<p><strong>Key highlights from Punjab &amp; Sind Bank (PSB) Q3 FY24 Earnings Concall<\/strong><\/p>\n<ul>\n<li><strong>Financial Performance<\/strong>\n<ul>\n<li>CASA ratio improved by 158 bps to 32.77% sequentially.<\/li>\n<li>NIM improved by 21 bps to 2.54% sequentially.<\/li>\n<li>Net interest income grew 9.48% to INR 739 crores sequentially.<\/li>\n<li>Gross NPA improved to 5.70%, decline of 53 bps.<\/li>\n<li>Operating profit improved to INR 277 crores sequentially.<\/li>\n<li>Yield on advances improved significantly to 8.91%, up 29 bps.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Business Growth<\/strong>\n<ul>\n<li>Total business crossed INR 2 lakh crore in Q3, growth of 7.84%.<\/li>\n<li>Deposits grew 8.09%, retail term deposits grew nearly 9%, CASA grew 6.38%.<\/li>\n<li>Retail advances up 15.5%, agri advances up 6.12%, MSME up 12.84%.<\/li>\n<li>RAM percentage improved from 49.47% to 51.46% on Y-o-Y basis.<\/li>\n<li>Core fee income increased by 35.29%.<\/li>\n<li>Fresh slippages contained at INR 228 crores, lowest in 4 quarters.<\/li>\n<li>SMA 2 book above INR 5 crores declined to INR 201 crores from INR 407 crores.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Outlook<\/strong>\n<ul>\n<li>Expect INR 350-400 crores recovery from NCLT and other bad debts in current quarter.<\/li>\n<li>Targeting 6-8% credit growth this quarter given dynamic environment and focus on bottom line protection.<\/li>\n<li>Aim to maintain NIM in 2.50-2.55% range in line with 9M NIM of 2.50%.<\/li>\n<li>Plan to raise INR 250 crores via QIP, will revisit plans and announce details after consulting committees.<\/li>\n<li>Currently comfortable capital adequacy ratio of 16.13%, so no immediate need.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Interest Expense Trends<\/strong>\n<ul>\n<li>Increase driven by higher deposit and borrowing costs.<\/li>\n<li>CASA migration also contributed but cost deposit up only 3bps vs 29bps increase in yield on advances.<\/li>\n<li>Able to grow qualitatively while protecting bottom-line.<\/li>\n<li>Cost-to-income ratio increased due to INR 150 crores of exceptional wage revision expenses.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Credit Growth Outlook<\/strong>\n<ul>\n<li>Targeting 6-8% growth this quarter.<\/li>\n<li>Consciously limiting corporate lending given high competition.<\/li>\n<li>Focus on profitable RAM sectors leveraging tech upgrade.<\/li>\n<li>Expanding services like digital lending through fintech tie-ups.<\/li>\n<li>Scaling up products like gold loans, personal loans etc.<\/li>\n<li>Raising RAM share from 51% currently to 60% next fiscal.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Falling Bond Yields Impact<\/strong>\n<ul>\n<li>Positive MTM impact on profits and cost-income ratio.<\/li>\n<li>Provided for depreciation last few quarters, got some reversal in Q3.<\/li>\n<li>Further yields decline to boost profits.<\/li>\n<li>Rate cut transmission will reduce EBLR loans cost.<\/li>\n<li>May enable higher income if investment yields can be maintained.<\/li>\n<\/ul>\n<\/li>\n<li><strong>HR Transformation Plans<\/strong>\n<ul>\n<li>Currently focused on upgrading technology.<\/li>\n<li>Will now work on HR processes like succession planning, competency mapping.<\/li>\n<li>Arranged specialized trainings in project and infrastructure financing.<\/li>\n<li>Planning initiatives around performance management, training, transfers etc.<\/li>\n<li>Sending top executives for training at reputed institutes.<\/li>\n<li>HR changes including lateral hires and training throughout 2024.<\/li>\n<li>Already hired CRO, other CXOs joining by April post notice period.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Undisbursed Loans Position<\/strong>\n<ul>\n<li>Around INR 500 crores of undisbursed sanctioned loans currently.<\/li>\n<li>Mainly pertains to infrastructure loans with pending disbursements.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Co-lending Business Progress<\/strong>\n<ul>\n<li>Grown co-lending book to INR 1,800 crores with over 10 partners.<\/li>\n<li>Earlier focused on priority sector, now entering non-priority sector as well.<\/li>\n<li>Also exploring direct assignment route, expected to implement after more tech readiness.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Key highlights from Punjab &amp; Sind Bank (PSB) Q3 FY24 Earnings Concall Financial Performance CASA ratio improved by 158 bps to 32.77% sequentially. NIM improved by 21 bps to 2.54% sequentially. Net interest income grew 9.48% to INR 739 crores sequentially. Gross NPA improved to 5.70%, decline of 53 bps. Operating profit improved to INR [&hellip;]<\/p>\n","protected":false},"author":1767,"featured_media":154818,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[9825,1],"tags":[8249,10169,1792],"class_list":["post-158394","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings-call-highlights","category-finance-stocks","tag-banks","tag-earnings","tag-financial-services"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":160546,"url":"https:\/\/alphastreet.com\/india\/axis-bank-ltd-q4-fy24-earnings-conference-call-insights\/","url_meta":{"origin":158394,"position":0},"title":"Axis Bank Ltd Q4 FY24 Earnings Conference Call Insights","author":"Praveen","date":"April 25, 2024","format":false,"excerpt":"Key highlights from Axis Bank Ltd (AXISBANK) Q4 FY24 Earnings Concall Deposit Franchise Strengthening Focused on improving deposit quality and strength over the past couple of years. 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