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ICICI Direct has buy call on CSB Bank with a target price of Rs 330. The current market price of
CSB Bank Ltd., incorporated in the year 1920, is a banking company (having a market cap of Rs 4988.58 Crore).
Financials
For the quarter ended 31-03-2021, the company reported a Standalone Total Income of Rs 609.45 Crore, up 1.70 % from last quarter Total Income of Rs 599.24 Crore and up 28.17 % from last year same quarter Total Income of Rs 475.50 Crore. The bank reported net profit after tax of Rs 42.89 Crore in latest quarter.
Backed by strong promoter (FairFax), renewed business strategy and adequate capital base, the bank is well placed to deliver sustainable 20%+ growth. Improving CD ratio coupled with healthy liability franchise would aid margins, growth in fee income and steady asset quality (owing to gold loan and selective SME lending) offer multiple levers for improvement in return ratios. The brokerage expects PAT to grow at 44% CAGR in FY21-23E to Rs 451 c
Shares of CSB Bank, on Friday, rallied 16 per cent to a fresh 52-week high of Rs 273.95 on the BSE in an otherwise weak market on the back of heavy volumes. The stock surpassed its previous 52-week high of Rs 270, touched on November 10, 2020. It hit an all-time high level of Rs 314 on December 5, 2019.
At 02:50 pm, CSB Bank was trading 12 per cent higher at Rs 265, against 1.07 per cent decline in the S&P BSE Sensex. The trading volumes on the counter jumped more than 10-fold with a combined 3.5 million equity shares changing hands on the NSE and BSE.
Fairfax-backed CSB Bank had reported a strong 89 per cent year on year (YoY) jump in net profit at Rs 53.05 crore during the quarter ended December 31, 2020 (Q3FY21) as compared to Rs 28.14 crore during the same period last year.
As a result the bank s yield on advances improved to 10.98% from 10.72% a year earlier. Higher yields pushed by the bank s net interest margin (NIM) to 5.17% from 3.92% a year earlier.