 "IndusInd Bank")
IndusInd Bank has reported a 25 per cent rise in net profit to Rs 620 crore in the January-March quarter; it was Rs 495 crore in the same quarter a year before. The rise was on the back of higher net interest and other income. For the full year of 2015-16, net profit increased 27 per cent to Rs 2,286 crore, as compared to Rs 1,794 crore in FY15.
Net interest income grew 37 per cent to Rs 1,268 crore as compared to Rs 925 crore a year before. The management said this was fuelled by the retail (small borrower) segment. In FY16, credit growth in this segment improved by 29 per cent and by 28 per cent in the corporate segment. Other income was up 31 per cent to Rs 913 crore.
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Romesh Sobti, MD, said there was improvement in credit growth. "We have seen capital expenditure happen in the renewable sector and the credit throughput in corporates has also improved. Within retail, we have seen an improvement both in the vehicle and non-vehicle book. Going ahead, we expect the contribution of the non-vehicle book to go up to 50 per cent from the current 31 per cent. However, I think it will take up to three years to reach that mix."
Asset quality came under slight pressure, with gross non-performing assets (NPAs) at 0.87 per cent, as compared to 0.81 per cent at the end of the same quarter in FY15. In absolute terms, GNPA for the quarter rose 38 per cent to Rs 777 crore from Rs 563 crore a year before. Net NPA saw a slight uptick of five basis points to 0.36 per cent.
Provisioning for doubtful assets almost doubled to Rs 214 crore from Rs 107 crore a year before. The management said this wasn't a cause for concern. The net interest margin improved to 3.94 per cent as compared to 3.68 per cent at the end of March 2015.
The bank is going to be focusing on the digital medium. The management has presented a strategy on this to the board of directors. The bank remained well capitalised, with a capital adequacy ratio of 15.5 per cent.
