Karnataka Bank shares plunge 12.6% after Q3 earnings, hit 2-week low
The bank's gross non-performing assets (NPA) experienced a YoY increase of 36 basis points, reaching 3.64% in Q3 FY24. However, the net NPA recorded an 11-basis point decrease, declining to 1.55%.
Karnataka Bank shares witnessed a substantial decline of 12.60%, hitting a 2-week low of ₹233.10 apiece in today's trading session. This decline follows the bank falling short of street estimates for the December-ending quarter with a deterioration in its asset quality.
The bank's gross non-performing assets (NPA) experienced a YoY increase of 36 basis points, reaching 3.64% in Q3 FY24. However, the net NPA recorded an 11-basis point decrease, declining to 1.55%.
While the Provision Coverage Ratio (PCR) has been maintained in the same range at 80.75% in December 2023 compared to 80.86% in March 2023, it has shown improvement by 54 basis points on a YoY basis (from 80.21% in December 2022).
It reported a net interest income (NII) of ₹827.60 crore, a 0.86% drop compared to the NII of ₹834.76 crore reported during the same period of the previous year, while the net interest margin (NIM) declined to 3.46% from 3.81% in Q3 FY23. When viewed sequentially, the NIM has decreased, as the bank reported 3.58% in Q2 FY24.
The bank recorded pre-provision operating profit (PPoP) at ₹540.20 crore for the December ending quarter, reflecting a 1.57% rise from the same quarter in the previous year when it stood at ₹531.87 crore.
Regarding net profit, the bank reported a nearly 10.11% increase to ₹331.08 crore in Q3 FY24. In the corresponding period of the previous year, the bank had posted a net profit of ₹300.68 crore. Sequentially, the net profit came in flat.
The bank posted an all-time high net profit for 9MFY 2023–24 of ₹1,032.04 crore, as against ₹826.49 crore earned during the corresponding period the previous year, thus registering a year-on-year growth of 25%.
The bank has clocked a record business turnover of ₹1,61,936.36 crore as of December 31, 2023, with a YoY growth rate of 9.22% (YTD growth of 11.84%), with advances of ₹69,740.97 crore registering YoY growth of 9.53% (YTD growth of 18.32%) and deposits of ₹92,195.39 crore registering YoY growth of 8.98% (YTD growth of 7.33%), according to bank's Q3 earnings report.
At 09:50 am, the stock was trading with a drop of 10.30% at ₹239.20 apiece.
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