Home Blog Stock In Action Bandhan Bank

Stock in Action: Bandhan Bank

Indian Stock Market

by Tanushree Jaiswal Last Updated: Dec 04, 2023 - 12:58 pm

5 min read 216 Views

0:00 -5:36

Unlocking Bandhan Bank's

Potential: A Financial Odyssey
As the autumn leaves fall, so do the barriers for
Bandhan Bank, marking a season of growth,
innovation, and financial prowess. In the most
recent Concall Notes of October 2023, the bank
revealed a series of strategic moves and stellar
performance indicators that have set the stage
for an intriguing surge in its stock value.

Technological Metamorphosis: A
Gateway to New Horizons
The metamorphosis of Bandhan Bank into a new
core banking system is a game-changer.
Successfully completing this migration opened
doors to a slew of novel products and services.
The launch of revamped internet banking
platforms and a mobile app, adorned with
improved user experiences, showcases the bank's
commitment to technological excellence.
Investors love a forward-looking company, and
Bandhan Bank is tapping into this sentiment with
its technological leap forward.

Guiding the Ship Through Financial

Waters
The guidance provided by Bandhan Bank is a
beacon in the financial sea. Confidence radiates
as they set their sights on a credit growth target
of nearly 20% YoY. What's particularly exciting is
the anticipation of the festive season triggering
an uptick in credit demand, a historical trend that
could add substantial wind to the bank's sails.

The company's assurance of surpassing Year-To-

Date (YTD) growth in the third quarter and
achieving a remarkable 20% Asset Under
Management (AUM) growth adds a layer of
optimism. As investors gear up for the festivities,
the bank positions itself to ride the wave of
increased financial activity.

Macroeconomic Stability: A Steady

Ship in Turbulent Waters
In the ever-fluctuating world of finance, Bandhan
Bank stands on solid ground. The macroeconomic
parameters of India are strong, with inflation at a
manageable 5%, and a projected GDP growth of
6.5% for the fiscal year 2024. These factors
contribute to the bank's stability and enhance
investor confidence.

The Dance of Deposits and

Advances
Bandhan Bank's dance with deposits and
advances is nothing short of impressive. The
focus on granular retail deposits and a retail-to-
total deposits ratio of 74% speaks volumes about
the bank's commitment to a stable and diverse
funding base. The growth in the loan book,
especially in retail assets and commercial
banking, further solidifies Bandhan Bank's
strategic positioning.

Financial Symphony: A Melody of

Profit and Margin
Financially, the bank is hitting all the right notes.
A net profit of Rs. 721 crores in Q2FY24, a YoY
growth of 245%, is a symphony to investors' ears.
Net Interest Income (NII) growing by 11.4% YoY,
coupled with a Net Interest Margin (NIM)
standing at 7.2%, indicates a well-balanced
financial performance.

Branch Expansion and Digital

Dominance
Adding 80 branches, achieving a branch presence
in 35 out of 36 states and union territories,
Bandhan Bank is spreading its wings across the
nation. Simultaneously, the improvement in
digital banking performance signifies an embrace
of the future. Direct tax collection authorization
and disbursing central civil pension further
amplify the bank's role in the digital
transformation of financial services.

Navigating Challenges: A Test of

Resilience
The challenges faced by Bandhan Bank, such as
slow growth in the housing book and the impact
of industry-wide policy shifts, are navigated with
strategic precision. The focus on reinstating a
robust credit culture and tightening policies
positions the bank for a sustainable future.

AUM Growth: Weathering the Storm

Although the AUM growth has been negative
Year-To-Date, the company's unwavering
confidence in achieving 20% YoY growth
indicates a belief in the future. The positive trend
from EEB INR2,000 crores in the second quarter
hints at a potential turnaround, making the stock
a tantalizing prospect for investors.

A Financial Tapestry Unravelled

In the world of finance, Bandhan Bank is weaving
a captivating tapestry. From technological
advancements to financial performance, the bank
is showcasing resilience, adaptability, and a
strategic vision. As the stock surges, investors
are not just buying shares; they are investing in a
financial odyssey with Bandhan Bank at the helm.
The pages of this financial saga are turning, and
the story is one of growth, stability, and a
promising future.

Strategy for Growth

Bank has clearly laid out its vision to be an
affordable financial institution by providing
simple, cost-effective and innovative financial
solutions in a courteous and responsible manner.
It intends to create value for all stakeholders
through a committed and efficient team, robust
practices, superior systems and technology while
continuing to deepen its customer reach.

In line with the India growth story, Bank

continued on its upward trajectory in terms of
extending businesses and remain in course to
achieve its broad targets. Bank has been able to
maintain steady growth in business through
operational innovations and expanding
geographical footprint:

• Bank has managed to outpace industry deposit

growth as growth came in 12 per cent. YoY. This
compares to around 10 per cent. YoY rise in
industry-level deposits.

• The growth was driven by a high CASA ratio of

39.3 per cent. at the end of FY 2022-23 and a high
share of retail deposits (71 per cent.).

• Bank is revamping its digital infrastructure at a

brisk pace. Some of the key highlights in our
digital banking space are as follows: – Fully
Digital Saving Account Neo+. The pilot for Neo+
Account with v-KYC has been launched in August
2022 across select branches and online
customers.
–New and improved CIB platform was launched in
May 2022 and this platform has won the Award
for “Best Digital Channel/Platform
Implementation” (December 2022) by IBS
Intelligence.

• Bank has maintained its pace of growth in terms

of employees and geographical footprint: During
the year under review, manpower has increased
by 16 per cent. from 60,211 as on March 31, 2022
to 69,702 as on March 31, 2023. Your Bank has
additionally enhanced its geographical network
with 1,411 retail branches, 4,390 banking units and
198 home loan centres in FY 2022-23.

• The advances of Bank remained robust as

growth came in at 10 per cent. YoY during the FY
2022-23. The growth was mainly driven by retail
(232.5 per cent. YoY), commercial (72.4 per cent.
YoY), housing (12.8 per cent. YoY) and SEBAL (18.2
percent YoY). We are set on our endeavours to
up-scale the business on the back of upgrading
technologies, portfolio & product diversification
and competent hiring. As global macroeconomic
uncertainty subsides, Bank is confident that the
virtuous combination of ongoing digital
transformation, incorporation of technical know-
how along with competent manpower
recruitment will continue to drive consistent
multi-year growth.

Financial Summary

Particulars(₹ in crore) March

Marc
23
2

Deposits 1,08,0

Advances (Net) 1,04,7

Total Assets/Liabilities 1,55,7

Net Interest Income 9,259

Non-Interest Income 2,468

Operating Expenses (excluding depreciation) 4,49

Profit before Depreciation, Provisions and Tax 7,234

Less: Depreciation 142

Less: Provisions 4,198

Profit Before Tax (PBT) 2,892

Less: Provision for Tax 698

Profit After Tax (PAT) 2,194

Balance in Profit & Loss Account brought forward from 6,00

previous year

Less: Appropriations 750

Balance carried over to Balance Sheet 7,453

EPS (Basic) (in ?) 13.

EPS (Diluted) (in ?) 13.62

(Source:AR)

Risks & Concern

Risks and concerns Your Bank is exposed to
various risks by the very nature of its business.
Your Bank has put in place a comprehensive
Enterprise wide Integrated Risk Management
Framework supported by detailed policies and
processes for management of Credit Risk, Market
Risk, Liquidity Risk, Operational Risk and various
other risks. Please refer to the section ‘Risk
Management’ of the Board’s Report for details.

Invest Now

How do you rate this blog?

1 star
★★ ★2★stars
3★stars
4 stars
5 starsSubmit Rating

Comments (1) View All Comments

Enter name

or

Folytatás a Google-lal

Post Comment

About the Author

Tanushree Jaiswal
Tanushree is a seasoned professional with 6 years of
experience in the Fintech and Edtech industry.

Disclaimer
Investment/Trading in securities Market is subject to
market risk, past performance is not a guarantee of
future performance. The risk of loss in trading and
investment in Securities markets including Equites and
Derivatives can be substantial.

Open Free Demat Account

Enter Mobile Number

Open Account Now

Mobile No. belongs to Self

By proceeding, you agree to the T&C.

Share Market

Market Guide

Mutual Funds

Calculators

Top Stocks

Indices

More

Follow us on

Download now

More Information
CIN: L67190MH2007PLC289249 | Stock Broker SEBI
Regn.: INZ000010231 | SEBI RA Regn.: INH000004680 |
SEBI Depository Regn.: IN DP CDSL: IN-DP-192-2016 |
AMFI REGN No.: ARN-104096 | NSE Member id: 14300 |
BSE Member id: 6363 | MCX Member ID: 55945 |
Investment Adviser Regn No: INA000014252 |
Registered Address - IIFL House, Sun Infotech Park,
Road no. 16V, Plot no. B-23, MIDC, Thane Industrial
Area, Waghle Estate, Thane, Maharashtra - 400604

*Brokerage will be levied flat fee/executed order basis

and not on a percentage basis. Flat fee of Rs. 10/order
is available with Power Investor & Ultra Trader Packs.
Investment in securities market are subject to market
risk, read all related documents carefully before
investing. Digital account would be opened after all
procedure relating to IPV and client due diligence is
completed. If sale/ purchase value of share of Rs.10/-
or less, a maximum brokerage of 25 paisa per share
may be collected. Brokerage will not exceed the SEBI
prescribed limit.

Compliance Officer: Ms. Namita Godbole, Email:

support@5paisa.com, Support desk helpline:
8976689766

Contact Us

Attention Investors

g to IPO. Just write the bank account number and sign in the ap

©2023, 5Paisa Capital Ltd. All Rights Reserved.

We are ISO 27001:2013 Certified.

Open Demat Account