ICICI Securities: Karur Vysya Bank Update - Improving Visibility On RoA Recovery; Upgrade
A customer counts Indian rupee banknotes. (Photographer Dhiraj Singh/Bloomberg)

ICICI Securities: Karur Vysya Bank Update - Improving Visibility On RoA Recovery; Upgrade

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.

Click on the attachment to read the full report:

ICICI Securities Karur Vysya Bank Update.pdf


This report is authored by an external party. BloombergQuint does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the brokerage and do not represent the views of BloombergQuint

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