29 October 2021
2QFY22 Results Update | Sector: Financials
Indian Bank
Buy
Estimate change
TP change
Rating change
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
12M Avg Val (INR M)
INBK IN
1,245
217.1 / 2.9
195 / 57
33/33/144
614
CMP: INR174
TP: INR200 (+15%)
Modest operating performance; asset quality stable
Credit cost likely to stay elevated; sharp increase in restructured book
Financials & Valuations (INR b)
FY21 FY22E
Y/E March
156.7 166.1
NII
114.0 133.4
OP
30.0
43.5
NP
2.8
2.7
NIM (%)
EPS (INR)
26.6
36.7
92.3
37.8
EPS Gr. (%)
312.1 329.0
BV/Sh. (INR)
234.1 262.3
ABV/Sh. (INR)
Ratios
9.8
12.3
RoE (%)
0.5
0.7
RoA (%)
Valuations
6.6
4.8
P/E(X)
0.6
0.5
P/BV (X)
0.7
0.7
P/ABV (X)
Shareholding pattern (%)
As On
Sep-21 Jun-21
Promoter
79.9
79.9
DII
10.5
10.4
FII
2.4
3.0
Others
7.2
6.7
FII Includes depository receipts
FY23E
178.6
145.7
47.6
2.7
38.3
4.4
364.3
298.9
11.7
0.7
4.6
0.5
0.6
INBK reported a mixed 2QFY22, with weak NII and elevated provisions
affecting PBT growth. However, net tax reversals aided earnings beat. On
the other hand, asset quality trends were largely stable.
Total recovery from the DHFL resolution stood at INR6.1b, which was
mainly utilized towards creating provisions on one large corporate account
(SREI Infra). On the business front, loan growth was impacted on account of
a decline in the Corporate portfolio (5% YoY decline), with a strong
sequential recovery in the Retail and MSME segment.
Asset quality held stable even as slippages came in elevated (~4.4%
annualized), led by higher recoveries/upgradations (~INR25.3b) and write-
offs (~INR23b), with GNPA/NNPA ratio declining by 13bp/21bp sequentially.
Restructuring book increased to 5.8% of loans. The high SMA book, at 6.4%,
would keep asset quality under check.
We expect a RoA/RoE of 0.8%/13% by FY23E. We maintain our
Buy
rating.
Sep-20
88.1
3.9
0.8
7.2
PPOP grew 11% YoY, slippages remain elevated, PCR improves to 68%
INBK reported a PAT of INR10.9b (+164% YoY), supported by tax reversals of
INR3.6b. PBT grew 2.5% YoY (32% miss) to INR7.3b. NII declined by 1.5%
YoY to INR40.8b, affected by higher interest reversal of INR3.2b and
subdued loan growth. Domestic NIM stood at 2.89%.
Core fee income declined by 8% YoY, while total other income grew 26%
YoY (+8% QoQ) to ~INR19.7b, led by a recovery in bad debts and a rise in
forex income.
OPEX was broadly flat YoY (~16% QoQ) ~INR27.7b. This includes an INR3b
impact from provisions made towards family pension and NPS. C/I ratio
increased to 45.9% (v/s 41.3% in 1QFY22). PPOP grew 11% YoY (in line) to
INR32.7b.
On the business front, loan growth stood ~INR3.6t (up 6% YoY, but down
1% QoQ), led by a decline in the Corporate portfolio (-5% YoY), while the
Retail (+14% YoY), MSME (+8% YoY) and Agri (+16% YoY) book continued to
show healthy trends. Deposits grew ~10% YoY (up +2% QoQ), led by 11%
YoY increase in term deposits. CASA deposits grew by 8.5% YoY. Domestic
CASA mix stood at 41.4% (+50bp QoQ).
On the asset quality front, slippages stood elevated at INR39.5b (~4.4%
annualized), led by Corporate, which includes an INR18.2b slippage from
SREI Infra on which 50% provisions have been maintained. However, higher
recoveries/upgradations of INR25b and write-offs of INR23b supported
asset quality, with GNPA/NNPA ratio declining by 13bp/21bp sequentially to
9.56%/3.26%. PCR improved further to 68.1% (v/s 66.5% in 1QFY22).
Nitin Aggarwal - Research Analyst
(Nitin.Aggarwal@MotilalOswal.com)
Research Analyst: Himanshu Taluja
(Himanshu.Taluja@motilaloswal.com) |
Yash Agarwal
(Yash.Agarwal@motilaloswal.com)
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
 Motilal Oswal Financial Services
Indian Bank
SMA book remains elevated at 6.4% (v/s 7.6% in 1QFY22), while the total
restructured portfolio (COVID framework 1.0 and 2.0) remains elevated at 5.8%
of loans (v/s ~2.7% in 1QFY22). Collection efficiency witnessed an improvement
and touched 91% in Sep’21 (v/s 89% in Jun’21), with
Retail/MSME/Agri/Corporate at 97%/92%/81%/98%).
The management expects recoveries/upgrades for 2HFY22 to be ~INR40b. Credit
cost for FY22E would be below 2%.
Credit growth in FY22E would be between 8% and 10%, with a higher focus on
RAM.
Highlights from the management commentary
Valuation and view
INBK reported mixed trends, with weak NII trends, while elevated provisions on
account of SREI Infra affected PBT growth. Business growth remains muted, led by a
decline in the Corporate portfolio, with a strong sequential recovery in the Retail
and MSME segment. The bank expects loan growth to improve, led by the RAM
segment. Asset quality was largely stable, despite elevated slippages, supported by
higher recoveries/upgradations. The restructured portfolio increased to ~5.8% of
loans and SMA overdue stood at 6.4% of loans. This keeps us watchful on asset
quality. We expect credit cost to stay elevated at 2.3%/2% in FY22E/FY23E. We cut
our FY23E earnings by 20%, factoring in lower NII growth and an increase in
provisions. We estimate RoA/RoE of 0.8%/13% by FY24E.
We maintain our Buy
rating and roll forward our estimate to Sep’23E with a revised TP of INR200 (0.6x
Sep’23E ABV).
Quarterly performance
Y/E March
Net Interest Income
% Change (YoY)
Other Income
Total Income
Operating Expenses
Operating Profit
% Change (YoY)
Other Provisions
Profit before Tax
Tax
Net Profit
% Change (YoY)
Operating Parameters
Deposits (INR b)
Loans (INR b)
Deposit Growth (%)
Loan Growth (%)
Asset Quality
Gross NPA (%)
Net NPA (%)
PCR (%)
E: MOFSL estimates
1Q
38,743
117.0
13,268
52,010
24,477
27,533
100.4
21,391
6,142
2,450
3,693
1.1
4,891
3,395
102.6
91.2
10.9
3.8
68.1
FY21
2Q
3Q
41,440 43,133
122.4
120.6
15,585 13,968
57,026 57,101
27,608 26,111
29,417 30,990
95.9
61.5
22,309 23,144
7,108
7,846
2,986
2,704
4,123
5,143
15.0
108.1
5,020
3,397
98.3
81.8
9.9
3.0
72.2
5,212
3,628
102.3
95.9
9.0
2.4
75.8
FY22E
2Q
3QE
40,835 41,859
-1.5
-3.0
19,659 18,542
60,494 60,401
27,739 28,258
32,755 32,143
11.3
3.7
25,472 20,035
7,283 12,108
-3,608
2,422
10,892
9,687
164.2
88.4
5,515
3,604
9.9
6.1
9.6
3.3
68.1
5,615
3,773
7.7
4.0
9.3
3.3
67.0
FY21
4QE
43,471
30.4
19,583
63,054
28,696
34,358
34.8
16,016
18,342
7,209
11,134
-34.8
5,757
3,859
7.0
6.0
9.2
3.0
69.8
1,56,659
106.0
60,793
2,17,452
1,03,496
1,13,956
75.4
84,901
29,056
-991
30,047
298.8
5,381
3,640
106.8
83.9
9.9
3.4
68.1
FY22E FY22E v/s our
2QE
Est
1,66,107 41,796 -2%
6.0
0.9
75,991 18,493 6%
2,42,097 60,290 0%
1,08,683 27,714 0%
1,33,415 32,575 1%
17.1
8.8
87,108 21,922 16%
46,307 10,653 -32%
2,778 2,685
43,529 7,969 37%
44.9
93.3
5,757
3,859
7.0
6.0
9.2
3.0
69.8
5,530
3,725
10.2
9.7
9.8
3.5
67.0
0%
-3%
(INR m)
4Q
33,343
66.5
17,439
50,783
25,299
25,484
49.6
17,525
7,959
-9,130
17,088
-884.8
5,381
3,640
106.8
83.9
9.9
3.4
68.1
1Q
39,942
3.1
18,207
58,148
23,990
34,159
24.1
25,586
8,573
-3,244
11,817
220.0
5,401
3,644
10.4
7.3
9.7
3.5
66.5
-23
-20
115
29 October 2021
2
 Motilal Oswal Financial Services
Indian Bank
Quarterly snapshot
1Q
51,376
33,521
17,854
6,945
2,023
1,586
2,806
24,800
11,058
6,701
4,357
13,742
11,719
7,948
4,822
5,794
2,140
3,654
2,415
1,776
135
68
11
7.3
3.8
49.5
66.3
1.1
19.8
48.5
36.9
34.2
73.5
8.4
8.3
5.4
2.9
0.5
2Q
FY20
3Q
4Q
1Q
2Q
FY21
3Q
4Q
89,039
55,696
33,343
17,439
4,540
4,660
6,590
50,783
25,299
14,022
11,277
25,484
20,944
17,525
28,703
7,959
-9,130
17,088
5,381
3,640
385
123
83
9.9
3.4
68.1
82.1
4.1
25.4
54.7
-114.7
42.3
67.7
6.3
6.4
4.1
2.3
1.1
1Q
FY22
2Q
Change (%)
YoY QoQ
-6
-9
-1
26
-32
262
-8
6
0
-2
5
11
22
14
18
2
-221
164
10
6
-2
-4
2
8
-29
32
31
4
16
17
14
-4
1
0
27
-15
11
-8
2
-1
-2
-7
-10
-13
-21
166
132
55
427
341
-1,170
49
-211
-8
-12
-19
4
-6
Profit and Loss (INRm)
Interest Income
Interest Expenses
Net Interest Income
Other Income
Trading profits
Recoveries
Core Fees
Total Income
Operating Expenses
Employee
Others
Operating Profits
Core Operating Profits
Provisions
NPA provisions
PBT
Taxes
PAT
Balance Sheet (INRb)
Deposits
Loans
Asset Quality (INRb)
GNPA
NNPA
Slippages
Asset Quality Ratios (%)
GNPA
NNPA
PCR (Cal.)
PCR (Inc. TWO)
Credit Cost
Business Ratios (%)
Fees to Total Income
Cost to Core Income
Tax Rate
CASA
Loan/Deposit
Profitability Ratios (%)
Yield on loans
Yield On Investments
Cost of Deposits
Margins
ROA
53,077
34,446
18,630
7,376
2,492
1,334
3,038
26,007
10,989
5,858
5,131
15,018
12,526
9,094
7,209
5,924
2,338
3,586
2,532
1,868
140
66
8
7.2
3.5
52.7
68.1
1.6
18.8
46.7
39.5
34.7
73.8
8.6
8.2
5.5
2.9
0.5
54,670
35,118
19,552
10,386
2,400
4,030
3,460
29,938
10,750
5,930
4,820
19,188
16,788
15,293
17,024
3,895
1,424
2,472
2,576
1,852
139
65
22
7.2
3.5
53.2
70.8
3.8
26.7
39.0
36.5
34.5
71.9
8.4
8.1
5.4
2.9
0.3
54,927 1,01,200 1,00,574 1,00,245
34,900 62,457 59,133 57,112
20,028 38,743 41,440 43,133
8,416
13,268 15,585 13,968
1,880
6,320
5,780
4,070
1,790
2,020
2,340
2,780
4,270
4,450
6,650
6,000
28,444 52,010 57,026 57,101
11,411 24,477 27,608 26,111
6,241
16,540 17,504 15,717
5,170
7,937
10,105 10,394
17,033 27,533 29,417 30,990
15,153 21,213 23,637 26,920
18,919 21,391 22,309 23,144
14,304 18,299 18,802
7,381
-1,886
6,142
7,108
7,846
291
2,450
2,986
2,704
-2,177
3,693
4,123
5,143
2,602
1,979
142
62
13
6.9
3.1
56.3
73.1
3.0
23.0
43.0
-15.4
35.4
76.0
8.4
7.6
5.2
3.0
-0.3
4,891
3,395
400
128
6
10.9
3.8
68.1
80.5
2.8
13.4
53.6
39.9
41.5
69.4
7.6
6.7
4.8
2.8
0.3
5,020
3,397
362
101
3
9.9
3.0
72.2
84.4
2.9
17.2
53.9
42.0
41.9
67.7
7.8
6.6
4.6
3.1
0.3
5,212
3,628
352
85
2
9.0
2.4
75.8
86.5
1.1
17.3
49.2
34.5
40.9
69.6
7.6
6.5
4.3
3.1
0.4
96,236
56,294
39,942
18,207
5,590
6,430
4,660
58,148
23,990
14,661
9,329
34,159
28,569
25,586
17,466
8,573
-3,244
11,817
5,401
3,644
378
127
44
9.7
3.5
66.5
82.0
2.0
21.7
45.6
-37.8
40.9
67.5
7.1
6.2
4.1
2.9
0.8
94,745
53,910
40,835
19,659
3,950
8,460
6,100
60,494
27,739
17,130
10,609
32,755
28,805
25,472
22,156
7,283
-3,608
10,892
5,515
3,604
369
2
117 17
40 1,155
9.6
3.3
68.1
83.3
2.5
26.0
49.1
-49.5
41.4
65.4
7.0
6.1
3.9
2.9
0.7
-33
30
-408
-107
-33
877
-482
-9,154
-53
-231
-82
-48
-71
-17
41
Highlights of management commentary
P&L & balance sheet related
Credit growth for FY22E would be between 8%-10% with higher focus on RAM
sector.
Increase in Employee expenses due to NPS and Family Pension. Total impact of
the family pension during the quarter was INR300m. However, total one-off
impact (NPS+ Family Pension) of INR3b.
3
29 October 2021
 Motilal Oswal Financial Services
Indian Bank
Total interest reversal during the quarter was INR3.2b.
Nearly 66% of the loan portfolio is linked to MCLR.
Asset quality
SMA 1 & 2 has declined with SMA-1 stands at 4.94% and SMA-2 at 1.47%.
One large corporate account (SREI Infra) slipped during the quarter was
INR18.2b on which made provisions at 50%. Also, another corporate account of
INR2b slipped during the quarter.
There are no big corporate accounts under potential stress while few small
ticket corporate accounts are there.
Total restructured loans (1.0 +2.0+ earlier schemes) would be around INR200b
on which made provisions at 10%. Within Retail, majority has come from the
housing portfolio (INR60b).
Total recoveries made in the DHFL resolution account was INR6.1b. This includes
Cash recovery of INR2.77b while bond recoveries of INR3.3b.
It expects recoveries/upgrades for 2HFY22 would be around INR40b.
Credit cost for FY22E would be below 2% while going ahead expects credit cost
to moderate further.
It will transfer NPA loans of INR19b to the NARCL on which recovery rate would
be around 18%.
Exhibit 1: DuPont Analysis: We expect return ratios to remain modest
Interest Income
Interest Expense
Net Interest Income
Fee income
Trading and others
Other Income
Total Income
Operating Expenses
Employees
Others
Operating Profits
Provisions
NPA
Othes
PBT
Tax
RoA
Leverage (x)
RoE
FY18
7.27
4.61
2.66
0.74
0.28
1.02
3.68
1.56
0.89
0.67
2.12
1.67
1.47
0.19
0.46
-0.08
0.53
15.5
8.3
FY19
7.20
4.57
2.63
0.64
0.07
0.71
3.34
1.51
0.83
0.67
1.83
1.73
1.36
0.37
0.11
-0.01
0.12
16.6
2.0
FY20
7.26
4.68
2.58
0.83
0.30
1.12
3.70
1.50
0.84
0.66
2.20
1.74
1.47
0.27
0.47
0.21
0.26
16.7
4.3
FY21
8.36
5.01
3.35
0.85
0.45
1.30
4.65
2.21
1.36
0.85
2.44
1.82
1.56
0.25
0.62
-0.02
0.64
18.1
11.6
FY22E
6.56
3.99
2.56
0.81
0.36
1.17
3.74
1.68
1.02
0.65
2.06
1.34
1.33
0.01
0.71
0.04
0.67
18.2
12.3
FY23E
6.56
4.01
2.55
0.88
0.37
1.25
3.79
1.71
1.04
0.67
2.08
1.17
1.15
0.02
0.91
0.23
0.68
17.3
11.7
FY24E
6.61
4.05
2.56
0.96
0.37
1.32
3.88
1.74
1.06
0.68
2.14
1.12
1.09
0.03
1.02
0.26
0.76
17.0
13.0
29 October 2021
4
 Motilal Oswal Financial Services
Indian Bank
Story in charts
Exhibit 1: Loan book grew ~6% YoY
Loans (INR b)
YoY (%)
91
96
84
Exhibit 2: Deposits growth at 10% YoY
Deposits (INR b)
YoY (%)
103 98 102107
82
5
14
22 23 22 20
15 16 12 12
8 9
7 6
14 10 10 9 16 15 15 14
8 12 12
7
10 10
Merged numbers from 1QFY21 onwards; Also, growth trends over
1QFY21-4QFY21 not comparable
Source: MOFSL, Company
Merged numbers from 1QFY21 onwards; Also, growth trends over
1QFY21-4QFY21 not comparable
Source: MOFSL, Company
Exhibit 3: CASA ratio stood at 41.4%
CASA Ratio (%)
Exhibit 4: NIMs stood at 2.89%
NIMs Quarterly (%)
3.1
2.7
2.9 2.9 2.8
3.1 3.1
2.8
2.3
3.0
2.9 3.0
2.9
2.9 2.9 3.0
2.9 2.9
Source: MOFSL, Company
Source: MOFSL, Company
Exhibit 5: GNPA/NNPA ratio improved by 13bp/21bp QoQ
GNPA (%)
NNPA (%)
Reported PCR (%)
76
68 72
68 66 68
Exhibit 6: Slippages trend over the quarters
Gross slippages (INR b)
Slippage Ratio (%)
16.8
5.2
0.7
0.4
43 43
56
49 49 53 53
8.5
2.2 1.1
2.8
4.0
5.9 4.4
2.4 2.6 1.9
5.2
2.8 1.4
4.4
Source: MOFSL, Company
Source: MOFSL, Company
29 October 2021
5
 Motilal Oswal Financial Services
Indian Bank
Financials and Valuations
Income Statement
Y/E March
Interest Income
Interest Expense
Net Interest Income
Growth (%)
Non Interest Income
Total Income
Growth (%)
Operating Expenses
Pre Provision Profits
Growth (%)
Core PPoP
Growth (%)
Provisions (excl tax)
PBT
Tax
Tax Rate (%)
PAT
Growth (%)
FY17
160.4
108.9
51.5
15.7
22.1
73.6
18.1
33.6
40.0
31.9
31.3
14.8
22.4
17.6
3.5
20.1
14.1
97.6
FY17
4.8
166.8
171.6
1,825.1
2.4
676.8
21.4
126.4
59.3
2,182.3
100.4
675.5
27.2
1,277.0
-1.0
34.4
95.0
2,182.3
FY17
98.7
56.1
7.5
4.4
2.6
1.6
43.2
FY18
171.1
108.5
62.6
21.7
24.1
86.7
17.8
36.7
50.0
25.0
43.4
38.7
39.2
10.8
-1.8
-17.0
12.6
-10.4
FY18
4.8
179.7
184.5
2,082.9
14.1
769.7
13.7
197.6
62.1
2,527.2
129.3
714.0
5.7
1,565.7
22.6
34.2
84.0
2,527.2
FY18
119.9
59.6
7.4
3.8
3.5
2.4
50.3
FY19
191.8
121.7
70.2
12.0
18.8
89.0
2.7
40.2
48.8
-2.4
47.1
8.4
46.0
2.8
-0.4
-13.3
3.2
-74.4
FY19
4.8
189.1
193.9
2,420.8
16.2
840.2
9.2
121.4
64.6
2,800.7
200.2
649.9
-9.0
1,812.6
15.8
39.6
98.3
2,800.7
FY19
133.5
67.9
7.1
3.7
3.8
2.1
49.1
FY20
214.0
138.0
76.1
8.4
33.1
109.2
22.7
44.2
65.0
33.1
56.2
19.4
51.3
13.7
6.2
45.1
7.5
134.0
FY20
6.1
214.8
220.9
2,602.3
7.5
901.6
7.3
208.3
63.2
3,094.7
139.2
812.4
25.0
1,978.9
9.2
39.0
125.2
3,094.7
FY20
141.5
61.8
6.9
3.1
2.8
2.3
56.3
FY21
391.1
234.4
156.7
106.0
60.8
217.5
99.2
103.5
114.0
75.4
92.7
65.0
84.9
29.1
-1.0
-3.4
30.0
298.8
FY21
11.3
372.8
384.1
5,380.7
106.8
2,275.9
152.4
261.7
233.5
6,260.1
540.6
1,765.4
117.3
3,640.1
83.9
73.8
240.2
6,260.1
FY21
384.6
122.7
9.9
3.4
2.7
2.1
68.1
FY22E
424.9
258.8
166.1
6.0
76.0
242.1
11.3
108.7
133.4
17.1
110.0
18.7
87.1
46.3
2.8
6.0
43.5
44.9
FY22E
12.5
428.9
441.4
5,757.4
7.0
2,400.8
5.5
258.0
245.1
6,701.9
535.4
1,959.6
11.0
3,858.5
6.0
81.1
267.3
6,701.9
FY22E
380.9
115.2
9.2
3.0
3.8
2.3
69.8
FY23E
460.0
281.4
178.6
7.5
87.4
266.0
9.9
120.3
145.7
9.2
120.0
9.1
82.0
63.7
16.1
25.2
47.6
9.5
FY23E
12.5
472.9
485.4
6,333.1
10.0
2,672.6
11.3
249.6
257.4
7,325.5
566.1
2,175.1
11.0
4,205.8
9.0
89.3
289.3
7,325.5
FY23E
387.1
112.5
8.6
2.7
2.8
2.0
70.9
(INRb)
FY24E
511.5
313.5
198.1
10.9
102.2
300.3
12.9
134.5
165.8
13.8
137.5
14.6
86.7
79.0
19.9
25.2
59.1
24.1
Balance Sheet
Y/E March
Equity Share Capital
Reserves & Surplus
Net Worth
Deposits
Growth (%)
of which CASA Dep
Growth (%)
Borrowings
Other Liabilities & Prov.
Total Liabilities
Current Assets
Investments
Growth (%)
Loans
Growth (%)
Fixed Assets
Other Assets
Total Assets
Asset Quality
GNPA (INR m)
NNPA (INR m)
GNPA Ratio
NNPA Ratio
Slippage Ratio
Credit Cost
PCR (Excl Tech. write off)
FY24E
12.5
528.4
540.9
7,093.1
12.0
3,014.6
12.8
243.2
270.3
8,147.4
586.9
2,436.1
12.0
4,710.5
12.0
98.2
315.7
8,147.4
FY24E
401.8
119.4
8.0
2.5
2.5
1.9
70.3
29 October 2021
6
 Motilal Oswal Financial Services
Indian Bank
Financials and Valuations
Ratios
Y/E March
Yield and Cost Ratios (%)
Avg. Yield- on Earning Assets
Avg. Yield on loans
Avg. Yield on Investments
Avg. Cost of Int. Bear. Liab.
Avg. Cost of Deposits
Interest Spread
Net Interest Margin
Capitalisation Ratios (%)
CAR
Tier I
Tier II
Business and Efficiency Ratios (%)
Loans/Deposit Ratio
CASA Ratio
Cost/Assets
Cost/Total Income
Cost/Core income
Int. Expense/Int.Income
Fee Income/Total Income
Non Int. Inc./Total Income
Empl. Cost/Total Expense
Investment/Deposit Ratio
Profitability Ratios and Valuation
RoE
RoA
RoRWA
Book Value (INR)
Growth (%)
Price-BV (x)
Adjusted BV (INR)
Price-ABV (x)
EPS (INR)
Growth (%)
Price-Earnings (x)
Dividend Per Share (INR)
Dividend Yield (%)
FY17
8.0
8.9
7.4
5.8
5.9
2.3
2.6
FY18
7.7
8.3
7.4
5.1
5.2
2.5
2.8
FY19
7.6
8.3
7.5
5.0
5.0
2.5
2.8
FY20
7.7
8.4
7.3
5.2
5.2
2.5
2.7
FY21
6.9
7.8
6.6
4.3
4.3
2.6
2.8
FY22E
6.9
8.0
6.5
4.4
4.4
2.5
2.7
FY23E
6.9
8.0
6.4
4.5
4.5
2.4
2.7
FY24E
7.0
8.1
6.3
4.5
4.5
2.5
2.7
13.6
12.2
1.4
12.8
11.5
1.2
13.5
11.5
1.9
14.6
12.5
2.0
16.0
12.3
3.8
16.4
13.0
3.5
15.9
12.8
3.1
15.2
12.5
2.7
70.0
37.1
1.5
45.6
51.8
67.9
18.2
30.1
59.3
37.0
75.2
37.0
1.5
42.3
45.8
63.4
20.1
27.8
57.3
34.3
74.9
34.7
1.4
45.2
46.1
63.4
19.2
21.2
55.3
26.8
76.0
34.6
1.4
40.5
44.0
64.5
22.3
30.3
55.9
31.2
67.7
42.3
1.7
47.6
52.7
59.9
18.2
28.0
61.6
32.8
67.0
41.7
1.6
44.9
49.7
60.9
21.7
31.4
61.0
34.0
66.4
42.2
1.6
45.2
50.0
61.2
23.2
32.9
60.7
34.3
66.4
42.5
1.7
44.8
49.5
61.3
24.6
34.0
60.7
34.3
10.1
0.7
1.1
326.4
6.4
0.5
243.7
0.7
29.3
97.6
6.0
7.0
4.0
8.3
0.5
0.8
354.1
8.5
0.5
265.4
0.7
26.2
-10.4
6.7
0.0
0.0
2.0
0.1
0.2
368.2
4.0
0.5
267.4
0.7
6.7
-74.4
26.0
0.0
0.0
4.3
0.3
0.5
335.8
-8.8
0.5
263.1
0.7
13.8
106.4
12.6
0.0
0.0
9.8
0.5
1.0
312.1
-7.1
0.6
234.1
0.7
26.6
92.3
6.6
2.0
1.1
12.3
0.7
1.3
329.0
5.4
0.5
262.3
0.7
36.7
37.8
4.8
2.2
1.3
11.7
0.7
1.3
364.3
10.7
0.5
298.9
0.6
38.3
4.4
4.6
2.9
1.7
13.0
0.8
1.4
408.9
12.2
0.4
339.4
0.5
47.5
24.1
3.7
2.9
1.7
29 October 2021
7
 Motilal Oswal Financial Services
Indian Bank
NOTES
29 October 2021
8
 Motilal Oswal Financial Services
Indian Bank
Explanation of Investment Rating
Investment Rating
BUY
SELL
NEUTRAL
UNDER REVIEW
NOT RATED
Expected return (over 12-month)
>=15%
< - 10%
< - 10 % to 15%
Rating may undergo a change
We have forward looking estimates for the stock but we refrain from assigning recommendation
*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within following 30
days take appropriate measures to make the recommendation consistent with the investment rating legend.
Disclosures
The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).
Motilal Oswal Financial Services Ltd. (MOFSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOFSL, the Research Entity (RE) as defined in the Regulations,
is engaged in the business of providing Stock broking services, Investment Advisory Services, Depository participant services & distribution of various financial products. MOFSL is a subsidiary
company of Passionate Investment Management Pvt. Ltd.. (PIMPL). MOFSL is a listed public company, the details in respect of which are available on www.motilaloswal.com. MOFSL (erstwhile
Motilal Oswal Securities Limited - MOSL) is registered with the Securities & Exchange Board of India (SEBI) and is a registered Trading Member with National Stock Exchange of India Ltd.
(NSE) and Bombay Stock Exchange Limited (BSE), Multi Commodity Exchange of India Limited (MCX) and National Commodity & Derivatives Exchange Limited (NCDEX) for its stock broking
activities & is Depository participant with Central Depository Services Limited (CDSL) National Securities Depository Limited (NSDL),NERL, COMRIS and CCRL and is member of Association of
Mutual Funds of India (AMFI) for distribution of financial products and Insurance Regulatory & Development Authority of India (IRDA) as Corporate Agent for insurance products.
Details of
associate
entities
of
Motilal
Oswal
Financial
Services
Limited
are
available
on
the
website
at
http://onlinereports.motilaloswal.com/Dormant/documents/List%20of%20Associate%20companies.pdf
MOFSL and its associate company(ies), their directors and Research Analyst and their relatives may; (a) from time to time, have a long or short position in, act as principal in, and buy or sell the
securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market
maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have any other potential conflict of interests with
respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the specific recommendations made by the analyst(s), as
the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even though there might exist an inherent conflict of interest in some of the
stocks mentioned in the research report
MOFSL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, the recipients of this report should be aware
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https://galaxy.motilaloswal.com/ResearchAnalyst/PublishViewLitigation.aspx
A graph of daily closing prices of securities is available at
www.nseindia.com, www.bseindia.com.
Research Analyst views on Subject Company may vary based on Fundamental research and
Technical Research. Proprietary trading desk of MOFSL or its associates maintains arm’s length distance with Research Team as all the activities are segregated from MOFSL research activity
and therefore it can have an independent view with regards to Subject Company for which Research Team have expressed their views.
Regional Disclosures (outside India)
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would
be contrary to law, regulation or which would subject MOFSL & its group companies to registration or licensing requirements within such jurisdictions.
For Hong Kong:
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and Futures Commission (SFC) pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst Regulations) 2014 Motilal
Oswal Securities (SEBI Reg No. INH000000412) has an agreement with Motilal Oswal capital Markets (Hong Kong) Private Limited for distribution of research report in Hong Kong. This report is
intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any investment or investment activity to which this document relates is only available to
professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these securities, products and services in any jurisdiction where their offer or
sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not located in Hong Kong & are not conducting Research Analysis in Hong Kong.
For U.S.
Motilal Oswal Financial Services Limited (MOFSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under applicable state
laws in the United States. In addition MOFSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers Act" and together with the 1934
Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any brokerage and investment services provided by
MOFSL , including the products and services described herein are not available to or intended for U.S. persons. This report is intended for distribution only to "Major Institutional Investors" as
defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as "major institutional investors"). This document must not be acted on or relied on by
persons who are not major institutional investors. Any investment or investment activity to which this document relates is only available to major institutional investors and will be engaged in only
with major institutional investors. In reliance on the exemption from registration provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") and
interpretations thereof by the U.S. Securities and Exchange Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOFSL has entered into a
chaperoning agreement with a U.S. registered broker-dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be
executed within the provisions of this chaperoning agreement.
The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered
broker-dealer, MOSIPL, and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading
securities held by a research analyst account.
For Singapore
In Singapore, this report is being distributed by Motilal Oswal Capital Markets Singapore Pte Ltd (“MOCMSPL”) (Co.Reg. NO. 201129401Z) which is a holder of a capital markets services license
and an exempt financial adviser in Singapore.As per the approved agreement under Paragraph 9 of Third Schedule of Securities and Futures Act (CAP 289) and Paragraph 11 of First Schedule
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Specific Disclosures
1 MOFSL, Research Analyst and/or his relatives does not have financial interest in the subject company, as they do not have equity holdings in the subject company.
2 MOFSL, Research Analyst and/or his relatives do not have actual/beneficial ownership of 1% or more securities in the subject company
3 MOFSL, Research Analyst and/or his relatives have not received compensation/other benefits from the subject company in the past 12 months
4 MOFSL, Research Analyst and/or his relatives do not have material conflict of interest in the subject company at the time of publication of research report
5 Research Analyst has not served as director/officer/employee in the subject company
6 MOFSL has not acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
7 MOFSL has not received compensation for investment banking/ merchant banking/brokerage services from the subject company in the past 12 months
8 MOFSL has not received compensation for other than investment banking/merchant banking/brokerage services from the subject company in the past 12 months
9 MOFSL has not received any compensation or other benefits from third party in connection with the research report
10 MOFSL has not engaged in market making activity for the subject company
********************************************************************************************************************************
The associates of MOFSL may have:
-
financial interest in the subject company
-
actual/beneficial ownership of 1% or more securities in the subject company
-
received compensation/other benefits from the subject company in the past 12 months
29 October 2021
9
 Motilal Oswal Financial Services
Indian Bank
other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the specific
recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even though there might
exist an inherent conflict of interest in some of the stocks mentioned in the research report.
-
acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
-
be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies)
discussed herein or act as an advisor or lender/borrower to such company(ies)
-
received compensation from the subject company in the past 12 months for investment banking / merchant banking / brokerage services or from other than said services.
The associates of MOFSL has not received any compensation or other benefits from third party in connection with the research report
Above disclosures include beneficial holdings lying in demat account of MOFSL which are opened for proprietary investments only. While calculating beneficial holdings, It does not consider
demat accounts which are opened in name of MOFSL for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from clients which are not
considered in above disclosures.
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research
analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.
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This report has been prepared by MOFSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and may not be
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constitute an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments for the clients. Though disseminated to all the customers simultaneously,
not all customers may receive this report at the same time. MOFSL will not treat recipients as customers by virtue of their receiving this report.
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The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in
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tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances. The securities discussed and opinions expressed in this report may not be
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products as well as non-investment grade securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied, is made as to the accuracy,
completeness or fairness of the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the
transparency and should not be treated as endorsement of the views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to
make modifications and alternations to this statement as may be required from time to time without any prior approval. MOFSL, its associates, their directors and the employees may from time to
time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to perform investment
banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a separate, distinct and independent
of each other. The recipient should take this into account before interpreting the document. This report has been prepared on the basis of information that is already available in publicly
accessible media or developed through analysis of MOFSL. The views expressed are those of the analyst, and the Company may or may not subscribe to all the views expressed therein. This
document is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, copied, in whole or in
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jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject MOFSL to any registration or licensing requirement within such
jurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are
required to inform themselves of and to observe such restriction. Neither the Firm, not its directors, employees, agents or representatives shall be liable for any damages whether direct or
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The person accessing this information
specifically agrees to exempt MOFSL or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOFSL or any of its affiliates or
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expenses that may be
suffered by the person accessing this information due to any errors and delays.
Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022 71934200/ 022-71934263; Website
www.motilaloswal.com.CIN
no.: L67190MH2005PLC153397.Correspondence Office Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road, Malad(West), Mumbai-
400 064. Tel No: 022 7188 1000.
Registration Nos.: Motilal Oswal Financial Services Limited (MOFSL)*: INZ000158836(BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst: INH000000412. AMFI:
ARN - 146822; Investment Adviser: INA000007100; Insurance Corporate Agent: CA0579;PMS:INP000006712. Motilal Oswal Asset Management Company Ltd. (MOAMC): PMS (Registration
No.: INP000000670); PMS and Mutual Funds are offered through MOAMC which is group company of MOFSL. Motilal Oswal Wealth Management Ltd. (MOWML): PMS (Registration No.:
INP000004409) is offered through MOWML, which is a group company of MOFSL. Motilal Oswal Financial Services Limited is a distributor of Mutual Funds, PMS, Fixed Deposit, Bond,
NCDs,Insurance Products and IPOs.Real Estate is offered through Motilal Oswal Real Estate Investment Advisors II Pvt. Ltd. which is a group company of MOFSL. Private Equity is offered
through Motilal Oswal Private Equity Investment Advisors Pvt. Ltd which is a group company of MOFSL. Research & Advisory services is backed by proper research. Please read the Risk
Disclosure Document prescribed by the Stock Exchanges carefully before investing. There is no assurance or guarantee of the returns. Investment in securities market is subject to market risk,
read all the related documents carefully before investing. Details of Compliance Officer: Name: Neeraj Agarwal, Email ID: na@motilaloswal.com, Contact No.:022-71881085.
* MOSL has been amalgamated with Motilal Oswal Financial Services Limited (MOFSL) w.e.f August 21, 2018 pursuant to order dated July 30, 2018 issued by Hon'ble National Company Law
Tribunal, Mumbai Bench.
-
29 October 2021
10