| The government holds a 69.47 per cent stake in the bank, which acts as a cushion towards raising the capital necessary to sustain growth. |
| The bank is targeting business growth of 20 per cent for FY07. It has moved from low-yielding to high-yielding assets and this, along with its added thrust on retail and SME lending, would help to raise the yield on advances. |
| Also, a robust CASA deposit base would help stabilise the cost of deposits. The report expects to see an improvement in the net interest margin, which is currently on the lower side. |
| The increasing coverage of business under CBS (around 73 per cent) would enable the bank to expand its fee and commission income, besides control of operating costs. |
| Its investment portfolio is fully hedged against the interest rate risk, with 80 per cent of the SLR investments being in the HTM category. |
| NIIT: Non-life insurance foray |
| Emkay Research recommends a "buy" on NIIT. The company recently acquired a controlling interest in ROOM Solutions, a $ 25 million, UK-based insurance solutions provider. |
| The report states the acquisition gives NIIT entry in the non-life insurance domain. ROOM's clientele include few of the largest insurance and re-insurance providers such as AIG, Munich Re, Swiss Re and Thomas Miller. |
| ROOM has its own platform, Subscribe, to process policy administration. NIIT intends to use this platform to enhance its BPO offerings. |
| ROOM Solutions is focused on the commercial insurance market and its offerings include IT solutions to the customers of Lloyd's, which has a substantial share in the re-insurance market in London. |
| NIIT derives around 35 per cent of its revenues from the BFSI space, with 15-20 per cent coming from the insurance segment. |
Explore Business Standard