BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Securities Report
ICICI Securities sees a retracement of valuation to 1x (~15% lower than 5-year average multiple) on likely ~60 basis points RoA improvement over FY21E-FY22E to 0.9%.
Key rationale: a) overall collections at ~95% as on October 29, 2020, with better collection in commercial segment than peers, speaks for Karur Vysya Bank’s superior customer profile (chart 14); b) calibrated growth during FY17-FY20 (5% loan CAGR) to ensure lower legacy stress and strong PCR at 64% would keep credit cost low; c) strong liability franchise (charts 5/6/7), adequate capital (tier-1 @ 16.4%) and completion of corporate book realignment will help revive credit growth quicker than peers; and d) revamped digital platform and business processes are likely to enable quality growth ahead.
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