South Indian Bank

(Aman Jain) #102

Not sure what u mean. All the rights I have dealt with during last 1 year had Asba option. I just fill the form and my bank processes it.

(sko5prasad) #103

I meant that whether the option of asba in rights issue available via INB channel or physically.
Thanks for the information. Will try this route next time.

(Marathondreams) #104

ASBA was mandatory if the value of payment above Rs. 200,000.

(Chiradeep Rao) #105

Any details on news item that had come about Phoenix ARC ( owned by KOTAK ) having bought 1800-2000Cr worth of loan from SIB ?

(Aman Jain) #106

South Bank seems to be a top buy now given the follwong:

  1. Post NPA Sale of ₹1800-2000 cr it’s a zero NPA bank.
  2. I am assuming they have sold the NPA at 50% haircut, hence the realization would be 900-1000cr. 3. The bank has outstanding provision of ₹700 crore on the books, hence further loss of ₹300-400cr needs to be booked.
  3. Post all this I am assuming the bank should have book value of ₹20-23.

This makes it probably the only bank, available at 0.9-1.1x book value and expected EPS OF ₹4 ±₹1 (FY19).

Views invited.

I don’t see any reason for it to quote at these valuations and foresee a easy doubler in next 1year and much higher valuations in times further ahead.
Disclosure: invested(5%), and will probably increase exposure next week.

(TT) #107

Where is the confirmation of sale of NPAs?

(Marathondreams) #108

Tourism is Kerala under pressure due to demonetization, liquor ban, Rupee appreciation, 9% service tax etc. This is clearly bad news for businesses focussed on Kerala like Muthoot, Mannapuram as well as banks like South Indian, Federal bank etc

(TusharSB) #109

ICICI Bank and Axis Bank were among the top sellers, with each moving out Rs 5,000-6,000 crore of loans each. They were followed by IDFC Bank at Rs 4,000 crore, South Indian Bank Rs 2,000 crore, HDFC Bank selling under Rs 900 crore and DBS Rs 1,400 crore.

more at:

(Mukesh Amar) #110

invst.pdf (2.1 MB)
Investor presentation 2017.
Disc: Tracking position as i feel it is more like a takeover candidate rather than a growth story.

(Marathondreams) #111

Brokerage houses updating target price for SIB post results with Motilal Oswal giving target of Rs 31 and Edelweiss giving target of Rs 35. CMP - 26.75

(Vivek Gautam) #113

A quality pvt sector bank available at distressed PSU bank valuations. Views invited.

(narender) #114


just wanted to understand why SIB has such low yields??? Their yield in 4q17 and 1QFY18 was just around 10%; this despite that entire portfolio focused on SMEs and Corps Even the retail loans of 12,000 cr primarily comprises loans to trade and manufacturing units.

When i look at some of the nbfcs targeting SME sector, they are generating yields in mid to high teens; while this bank is languishing on yield front. What am i missing from loan book perspective??

What i like is acceptable valuation, low npa/ stressed assets; and good liability management.

(saurabhsharmaa2020) #115

The South Indian Bank Limited has submitted to the Exchange, the financial results for the period ended 30-Sep-2017

Loan growth and NIM is good, only provisions are raised…

(bmathew) #116

SIB down 7% post results on poor head line numbers , However a closer look reveals a different picture :slight_smile:

Against the reported profit of 4cr the adjusted profit would be closer to 170cr (adjusting for the up fronting of provisioning)

“SIB numbers are very strong on the operational front – bank Is moving towards becoming a matured private sector bank . After cleanup of B/S in the past 3 years bank has come out all guns blazing on the operation front during the current quarter. Improved operational Metrics with strong control on asset quality coupled with lower provisioning requirement (due to up fronting of provisioning ), Management is well on track to achieve a 1% ROA and 15% RoE by FY19…”

• Key factor which have spooked the market but should be seen as silver lining - -
:slight_smile: High provision of 454cr , of which 250cr is for investment diminution.

Management has in various forums guided for 800-850cr as provision required for the full year (which included the investment depreciation impact) with the up fronting of provision in Q2 the incremental ask rate falls to just 125-130cr /quarter; Adjusting for the upfronting the PAT runrate would be around 170cr in the coming quarters (with strong pick up in loan book growth in 2H adding to the tail wind)

• Positives on the P&L front – All guns blazing on the operational front
Calculated NIMs expanded to 3% (23bps qoq)
Strong growth in operational other income led by commission and (treasury on ) forex…
PPP growth of 54% is the highest ever by the company in the last 10quarters and all these are led by banks steady improvement on all the operational parameters…
C/I ratio improved significantly to 45% (600bps sequential improvement) …
Adjusting for the up fronting of provision the PAT reported for the quarter would have been 170cr (70% jump sequentially) compared to full year pat of 393cr in FY17 (43% of full year pat in Q2 itself)

• Positives from the Balance sheet –
2500cr increase in loan book sequentially (in a muted quarter) is the highest absolute growth ever by the bank in the past 10 quarters…2H growth to be far better than seen in 1H

Net slippage of 71cr in Q2 speaks volumes of the management confidence of restricting the net incremental slippages

(vamsi21) #117

SWIFT Disclosure in Annual Report 2017:

Page 54 AR2017

Security is the major threat faced by the banking industry these
days. The disruptive force of technology has proved to be a
double-edged sword. This threat gets severe with the quantum
of cyber-attacks intensifying with time in the banking sector.
In recent times, cyber criminals have shifted their focus to
targeting critical banking infrastructure. Created with the intent
to provide security and reliability to banks, the repercussions
of successfully breaching SWIFT systems can prove to be
hazardous. Unless and until the banks establish a strong security
system to protect themselves from all these attacks, the whole
banking technology infrastructure will be under risk.

(bmathew) #118

Mr. V.J. Kurian, has been appointed as Additional Director of South Indian Bank Ltd w.e.f. March 23, 2018.

Mr. V.J. Kurian, aged 61 years, is a retired Indian Administrative Service personnel (IAS) 1983 batch in Kerala Cadre. He retired as Additional Chief Secretary, Water Resources. Government of Kerala in February 2017. During the tenure of services, he held the position of Managing Director in various companies for a total period of 22 years. Presently Mr. Kurian is the Managing Director of Cochin International Airport Ltd, CIAL Infrastructures Ltd & CIAL Duty free and Retail Services Ltd and Director in Air Kerala International Services Limited, Cochin International Aviation Services Limited & Kerala Waterways and Infrastructures Limited.

(Gaurav Agarwal) #119

How can one be Managing Director in so many companies?

(lalani123) #121

Much below book value, cheapest among private banks valuation, negative sentiments, are there any other actual risk to this stock ?

(shyam) #122

Provision coverage is only at 40%, including prov on standard assets.
Adjusted for net NPA , its trading a P/BV of 1.03, far from a bargain, esp as there might well be more slippage this year.
Also they are diluting equity by 10-12% so that will exert a downward pressure on the stock.
I would advise you to wait for a better price.

(lalani123) #123

Thanks Shyam.

How do you value a bank because I feel lost to value it. Btw, I own yes bank.