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News: Indian Bank reported steady performance on growth, profitability and asse quality. Growth in advances came at 12% YoY to ₹4.9 lakh crore, with agri (16% YoY) and retail (14% YoY) being segments with higher growth. Within retail, auto (36% YoY) and personal loans (49% YoY) segments grew at a faster pace. Margins declined ~10 bps QoQ to 3.46%, primarily led by ~29 bps increase in cost of deposits, partially offset by improving yields. Healthy operational profit at 19% YoY coupled with lower provision resulted in 62% YoY increase in PAT at ₹1998 crore. Asset quality improved further with decline in ~50 bps at 4.97%, while slippages run rate witnessed uptick at 1.77%.
Views: Business growth at 12-14% and gradual improvement in RoA (at 1.06% in Q2FY24) augurs well for earnings momentum and thereby valuations.
Impact: Positive