Hi pd,
Yes, he seems to be a laidback guy (maybe just projecting it?). I liked his ‘I am a gentleman of leisure’ attitude…I sure want to get there. And, he goes on to call his own Dhando Investor a stupid book or something to that effect 
Nothing much to do nowadays but to read books and watch videos. The SEBI regulations seem to have stopped the amount of discussion on this forum 
Mushtaq Ahmad, CM & CEO & Parvez Ahmad, Executive President add the call. Highlights of the call by Capital Mkt:
During the quarter ended Dec, 2014, Net Profit fell 67% to Rs 104.64 crore compared to Rs 321.29 crore earned during the quarter ended Dec, 2013.NIMs for the quarter stood at 3.66% (annualized) vis–vis 3.97% for the corresponding quarter.Post tax Return on Assets stood at 0.57% (annualized) compared to 1.88% y-o-y.Post Tax Return on Average Net-Worth (annualized) stood at 6.89% compared to 22.80% y-o-y.
Cost of Deposits (Annualized) stood at 6.71% compared to 6.94% y-o-y.Yield on Advances (annualized) was at 11.29% against 12.24% y-o-y.Business per Employee and Net profit per Employee (annualized) were at Rs 11.63 crore and Rs 4.50 lakh respectively for the quarter ended Dec, 2014 compared to Rs 11.36 crore and Rs 13.71 lakh pertaining to the quarter ended Dec, 2013.
Gross and Net NPA’s as percentages to Gross and Net Advances was at 5.81% and 3.22% respectively compared to 1.65% and 0.22% a year ago.NPA Coverage Ratio as on Dec, 2014 stood at 51.00%.Cost to Income Ratio stood at 48.47% for the quarter as compared to 39.94% y-o-y.Capital Adequacy Ratio (Basel III) stood at 12.78% as on Dec. 2014 against RBI stipulated norm of 9%.The total provisions, excluding for income tax, rose to Rs 220.39 crore as against Rs 4.60 crore in the year-ago period
For the nine months
Net Profit stood at Rs 406.99 crore, down 56 % as compared to Rs 931.87 crore.NIMs stood at 3.77% (annualized) vis–vis 4.18%.Post tax Return on Assets stood at 0.75 % (annualized) compared to 1.88 %Post Tax Return on Average Net-Worth (annualized) stood at 9.16 % compared to 23.31 %
Cost of Deposits (Annualized) was at 6.79% compared to 6.70%.Yield on Advances (annualized) stood at 11.58% as compared to 12.25%.Business per Employee and Net profit per Employee (annualized) were at Rs 11.63 crore and Rs 5.83 lakh respectively for the nine months compared to Rs 11.36 crore and Rs 13.25 lakh.Gross and Net NPA’s as percentages to Gross and Net Advances as on Dec. 2014 stood at 5.81% and 3.22%.NPA Coverage Ratio as on Dec. 2014 stood at 51.00 %.Cost to Income Ratio stood at 44.81% for the nine months as compared to 37.31 %
Other details
Restructured assets rose 27% y-o-y from 1415.76 crore to Rs 1269.30 crore.Cash & Bank Balance stood at Rs 2756.34 crore up 9.1% y-o-y.Saving Deposits increased 7.4% to Rs 20605 crore.Term Deposits fell 3.3% to Rs 37407 crore.Deposits in J&K state grew 12% to Rs 46787 crore as of December 2014.Deposits in rest of India fell 19% to Rs 17118.82 crore as of December 2014.
Business outside J&K fell as the Bank was not aggressive.The management expects business in J&K to grow by 25% and that outside J&K to grow along with industry average of around 15%.Gross advances in J&K state grew 17% to Rs 21899 crore as of December 2014.Gross advances in rest of India fell 6% to Rs 24087 crore as of December 2014Outstanding NPA from one shipping company is around Rs 180 crore.
For REI Agro account the bank had given loans of Rs 650 crore. As per RBI norms it has to provide for 15% or 25% as the case may be. But the bank has provided Rs 230-240 crore. The bank expected it to go to CDR but the consortium denied it. It hopes to sail through this account but will take time.
The bank provided Rs 500-600 crore for loss due to floods. More Rs 300 crore needs to be provided.J&K state has submitted package of Rs 44000 crore to the central government and it expects Rs 30-35000 crore to be sanctioned. Most of it should be routed through J&K Bank.NIM in J&K state stood at around 6% while NIM outside J&K state stood at below 3%.CASA improved from 39% to 41% during the nine months.
The bank will make more provisioning in March 2015 quarter, so that next FY does not carry big provisions.
Check this link;
Hearsay says that JK bank in the past used to be influenced by politicians and hence had a lot of “cozy” lending relationships. with floods, change of government and change of government at the centre, this is bound to change.
My sense is that things are going to get worse before they get better. Of course, that could always offer a point of entry.
Book value after Q3 is 126.4/-
Its usual RoE is 22%+ which the management aims to reattain in 1 year. Net NPA is bad ofcourse at 3.22% (1400 cr)
CASA is 41% (main bank in J&K). It means that the cost of funds is low and after NPA problem is resolved, NIM will be 4%+ again.
It has already fallen from 140-150/- to 108/-. I am looking to buy it, don’t know how much should I wait.
negatives: last 50+ days, no govt. in the state.
Bad numbers recently.
positives: Talks are going on between PDP and BJP.
Hopefully, some relief should come out for this bank once the govt is formed.
It is close to 5 years low now, any updates?
Van Eck Associates bought 67lacs shares @ 25.15
kotak fund bought 2.8cr shares @ 25.75
current holding of MA yussufali stands at 5cr. from initial 3cr. (don’t know at when and at what price he increased)
current holding of mohnish pabrai stands at 6cr. shares from initial 1.9cr. (don’t know at when and at what price he increased)
number of branches increased to 821 from 800.
highest per employee profit.
MFs has highest ever exposure to banking sector.
disc: I hold and adding more on every decline of 5%.
Van Eck Associates bought 67lacs shares @ 25.15
kotak fund bought 2.8cr shares @ 25.75
current holding of MA yussufali stands at 5cr. from initial 3cr. (don’t know at when and at what price he increased)
current holding of mohnish pabrai stands at 6cr. shares from initial 1.9cr. (don’t know at when and at what price he increased)
number of branches increased to 821 from 800.
highest per employee profit.
MFs has highest ever exposure to banking sector.
disc: I hold and adding more on every decline of 5%.
Van Eck Associates bought 67lacs shares @ 25.15
kotak fund bought 2.8cr shares @ 25.75
current holding of MA yussufali stands at 5cr. from initial 3cr. (don’t know at when and at what price he increased)
current holding of mohnish pabrai stands at 6cr. shares from initial 1.9cr. (don’t know at when and at what price he increased)
number of branches increased to 821 from 800.
highest per employee profit.
MFs has highest ever exposure to banking sector.
disc: I hold and adding more on every decline of 5%.
I have posted my thoughts while investing in the bank here.
http://http://www.myjotpage.blogspot.nl/2015/04/wish-i-knew-where-i-was-going-to-die.html
Souldnt uplaod the document due to size restrictions. Please let me know your (critical) comemnts
Mushtaq Ahmad, CM & CEO & Parvez Ahmad, EP add. the call.Highlights by Capital Mkt
For the quarter ended March 2015, the bank recorded 2% fall in the net interest income at Rs 682.57 crore as interest earned fell 2% to Rs 1744.97 crore and interest expenses fell 1% to Rs 1062.40 crore. PAT fell 59% to Rs 101.61 crore.In FY 2015, the bank recorded 1% fall in the net interest income at Rs 2650.91 crore as interest earned grew 4% to Rs 5316.16 crore but interest expenses jumped 8% to Rs 4410.22 crore. PAT fell 57% to Rs 508.60 crore.NIM for the 4th quarter of current FY is 3.92% while it stood at 3.81% for FY 2015 .CASA Ratio has increased from 39.06% to 41.79%. 52% of the casa ratio was from the J&K state.The Yield on Advances is 11.52%.
The stress in country’s economy is far from over. Very slow economic growth across the country has compounded the revival of stressed assets in the banking system which in turn has resulted in continuation of stress on asset-quality of the banks during the FY 2014-15.The cleansing and consolidating of balance sheet has led to a major slash in the bank’s profits because strengthening balance sheet remained its top priority during the FY 2015.
Since there is a course correction going on across the industry and J&K Bank too had to go for higher provisioning with the objective of having a higher Provision Coverage Ratio (PCR).It has provided Rs 265 crore in excess of required regulatory requirements thereby improving PCR to 59% from 51% as recorded in the quarter ending December 31, 2014.Even now the bad loans continue to swell across the industry, which analysts and rating agencies predict will increase during the current year as well. Total NPA in the banking sector is estimated to increase by Rs 60000 crore in FY 2016 so J&K Bank will also be impacted.
Gross NPA increased from Rs 783.42 crore as of March 2014 and Rs 2657.88 crore as of December 2014 to Rs 2764.05 crore as on March 2015. This increase was due to REI agro to which J&K bank had given Rs 675 crore loan. The bank was supposed to provide of Rs 340 crore but has provided for Rs 545 crore so far. The bank has sufficient security available for the rest amount of Rs 130 crore but it will provide for the same in the coming two quarters. REI Agro has been declared as frauds by the banks.
Net NPA increased from Rs 101.99 crore as of March 2014 to Rs 1236.32 crore as on March 2015. As on December 2014 it stood at Rs 1428.19 crore.Company is taking steps to increase its other income and the rise during in FY 2015 is a testimony to the same.Thus improving asset quality shall engage its total focus till economic growth starts picking up and NPA scenario improves. Besides, It have put in place a robust mechanism for NPA management enabling to track down early warning signals in loan-book.The management hopes to maintain its growth momentum and profitability with an improved Net Interest Margin (NIM) in FY 2016.
In J&K, things are slowly coming out of the effects of damaging September deluge. The bank had to spend 6-7 months just setting things right due to the problems created by the floods.Mgt expects a steady increase in lending in J&K particularly in infrastructure, agriculture &SMEs in FY 2016.
Post-floods, the bank has disbursed around Rs 700 crore additionally through its relief & rehabilitation package in the state. Besides,its business partner Bajaj Allianz has already paid out more than 1,000 cr. while settling 30,000 claims of customers from different sectors of economy including SMEs,handicrafts & small businesses.
In FY 2015 the bank opened 40 new Business Units besides commissioning 83 ATMs across the country. 91% of the ATMs are in the state of J&K and 9% in Rest of India (RoI). On the other hand 764 branches (86%) is in the state of J&K and 14% in rest of India.Growth target from the state of J&K is 25% for FY 2016.Out of the gross advance lending 49% is from J&K and the rest from rest of India. Thus the management feels that it is well placed to see better margins ahead.The bank repaid high cost deposit thus saving Rs 60 crore as interest expenses.
Capital Adequacy Ratio (Basel III) stood at 12.57 % as on Mar, 2015 against RBI stipulated norm of 9 % and as compared to 12.69 % on Mar, 2014.Restructured Assets grew to Rs 2467 crore in FY 2015 against Rs 1576 crore. Out of the addition of Rs 700 crore to the restructured assets, Rs 500 crore was from the state of J&K.Turbulence for the banking industry is going to continue in the current year, however, for J&K Bank the worst is over.Gross NPA should come below 5% in FY 2016.
Investment book was Rs 25000 crore out of which the Central Government accounted for 10531 crore and State Government accounted for 2600 crore. Rest was from private.
Mushtaq Ahmad, CM & CEO add the call.Highlights by Capital Mkt:
For the quarter ended June 2015, the bank recorded 9% rise in the net interest income at Rs 694.84 crore as interest earned fell 1% to Rs 1752.72 crore and interest expenses fell 6% to Rs 1057.88 crore.Other income grew 4% to Rs 135.63 crore after which net total income grew 8% to Rs 830.47 crore.As operating expenses grew 16% to Rs 372.16 crore, OP rose 2% to Rs 458.31 crore.Provision and contingencies fell 14% to Rs 212.87 crore. PBT grew 22% to Rs 245.44 crore.As taxation grew 23% to Rs 86.68 crore, PAT grew 22% to Rs 158.76 crore.Gross NPA increased from Rs 1887.99 crore as of June 2014 and Rs 2764.08 crore as of March 2015 to Rs 2994.50 crore as on June 2015.In percentage terms, %GNPA rose from 4.16% as of June 2014 and 5.97% as of March 2015 to 6.63% as on June 2015.Net NPA increased from Rs 968.49 crore as of June 2014 and Rs 1236.32 crore as of March 2015 to Rs 1276.76 crore as on June 2015.In percentage terms, %NPA rose from 2.18% as of June 2014 and 2.77% as of March 2015 to 2.95% as on June 2015.
Industry still sees turbulence times and will see it for few some more time.The Banking industry will add NPAs to the extent of 60000 crore to 100000 crore.NIMs stood at 3.93 % (annualized) vis-à-vis 3.63 %
The management would like to maintain NIM despite difficult times.Post tax Return on Assets stood at 0.88 % (annualized) compared to 0.72 % for the corresponding period of the previous financial year.Post Tax Return on Average Net-Worth (annualized) stood at 10.26 % compared to 8.99 %…The Deposits of the bank were at Rs 62264.91 crore while as the advances have reached Rs 43267.28 crore, taking the total business of the bank to Rs 105532.19 crore as on June 2015.Cost of Deposits (annualized) for the quarter ended stood at 6.41 % against 6.89 %Yield on Advances (annualized) for the quarter ended Jun, 2015 stood at 11.33 % as compared to 11.51 % for the quarter ended June 2014 quarter.Business per Employee and Net profit per Employee (annualized) were at Rs 11.32 crore and Rs 6.81 lakh respectively for the quarter ended June 2015 against to Rs 11.57 crore and Rs 5.57 lakh.Gross and Net NPA’s as percentages to Gross and Net Advances as on Jun, 2015 at 6.63 % and 2.95 % respectively compared to 4.16 % and 2.18 % a year ago.CASA increased from 40.96% to 45%.Cost to Income Ratio stood at 44.81 % for the quarter ended June 2015 against 41.78 %. The company hopes this to go back to 40 in coming times.Capital Adequacy Ratio (Basel III) stood at 12.93 % as on Jun, 2015 (RBI norm 9 %), which was recorded at the same level of 12.93 % as on June 2014.Capital Adequacy Ratio of the bank under BASEL (II) is 13.11%.Advances in J&K increased and now it accounts for 52%, outside Jk state it is 48%.As business in JK state increase, NIM also should improve.The management expects funding from central govt for infrastructure development in Jammu and Kashmir. J&K Bank being main player hopes to benefit from this.In the coming years with the central govt package and with normal growth it should grow 25^% in JK state and 12% from outside JK state.Restructured assets stood at Rs 2505.39 crore. Additions during the period was Rs 26.21 crore and Repayments / Reductions / Reclassification / Up gradations, etc, Net off Additional Disbursements during the period was Rs 11.85 crore.
Bombay based client in Real estate which was in a/c of the NPA has repaid most of the loan.The company is in the process of getting the valuation of its stake in Metlife which it plans to sell it off.
Slipages were Rs 339 crore in June 2015 quarter. Major were of 2 a/cs one each one was in Delhi (Steel) and Bombay (Automobile) which totaled Rs 150 crore. The bank hopes to upgrade the same in next quarter.The company has control over asset of REI agro which it can sell but it would be worth Rs 100-150 crore only.The bank has not done any sale to ARC.During the quarter, the bank added 21 ATMs and 4 Business Units raising total number of its branches to 821 and ATMs to 906.Margins in JK state is 6% and outside it is around 3%.
I think the way we can analyze JK Bank is by focusing on a slightly different track
In State after State, Private Banks have come in and taken Market Share away from PSU Banks, be it HDFC Bank, ICICI Bank or Axis Bank, these guys are faster, more disciplined and understand product marketing and relationships
JK Bank is the only Bank which has mostly maintained it’s hold on it’s home state, it enjoys a lot of unfair advantages and can compete with the likes of HDFC Bank and ICICI bank effectively
To understand these unfair advantages I think every potential and existing investor of JK bank should read the following article which is both very very insightful as well as detailed
How a bank in Kashmir beat terror
(And became the biggest success story of a violence-ridden valley)
For the record, Pabrai was mentioned quite a few times in this thread, he has quite an average track record in the three funds he runs which were started in 1999, 2001 and 2002
His returns annualized have been 15%, 12% and 10% since inception
He is a very smart guy, very wise and a marketing GOD, but as an investor he is ranking just above Guy Spier who himself has averaged 10% since inception 
Mushtaq Ahmad, CM & CEO addr the call.Highlights by Capital Mkt
For the quarter ended September 2015, the bank recorded a stagnant net interest income at Rs 694.47 crore as interest earned fell 4% to Rs 1721.33 crore and interest expenses fell 7% to Rs 1026.86 crore.Other income jumped 49% to Rs 126.51 crore after which net total income grew 6% to Rs 820.98 crore. As operating expenses grew 11% to Rs 383.27 crore, OP rose 1% to Rs 437.71 crore. Provision and contingencies fell 24% to Rs 126.58 crore. PBT grew 18% to Rs 311.13 crore. As taxation grew 25% to Rs 115.51 crore, PAT grew 14% to Rs 195.62 crore.
NIMs for the quarter ended Sep, 2015 at 4.02 % (annualized) vis-à-vis 4.01 % y-o-y.During the quarter, Post tax Return on Assets was 1.10 % (annualized) compared to 0.96 % y-o-y.During the quarter, post tax return on Average Net-Worth (annualized) stood at 12.29 % compared to 11.60%.During the quarter, cost of deposits (annualized) stood at 6.41% compared to 6.80%.
During the quarter, yield on advances (annualized) stood at 11.29 % as compared to 11.91 % for the quarter ended Sep, 2014For the six months ended September 2015, the bank recorded a 3% rise in net interest income at Rs 1389.31 crore as interest earned fell 3% to Rs 3474.05 crore and interest expenses fell 7% to Rs 2084.74 crore.
Other income jumped 22% to Rs 262.14 crore after which net total income grew 6% to Rs 1651.45 crore. Provision and contingencies fell 18% to Rs 339.45 crore. PBT grew 15% to Rs 556.57 crore. As taxation grew 24% to Rs 202.19 crore, PAT grew 10% to Rs 354.38 crore.
For the six months, NIMs stood at 3.97 % (annualized) vis-à-vis 3.83%.Post tax Return on Assets stood at 0.99 % (annualized) for the half year compared to 0.84%.Post Tax Return on Average Net-Worth (annualized) for the six months stood at 11.27% compared to 10.29%.For the six months, Cost of Deposits (annualized) stood at 6.40% compared to 6.84%.
Gross NPA stood Rs 3081.68 crore as on September 2015 against Rs 2186.94 crore as of September 2014 and Rs 2994.50 crore as of June 2015.In percentage terms, %GNPA stood at 6.48% as on September 2015 against 4.73% as of September 2014 and 6.63% as of June 2015.Net NPA stood at Rs 1269.69 crore as on September 2015 against Rs 1108.53 crore as of September 2014 and Rs 1276.76 crore as of June 2015.In percentage terms, %NNPA stood at 2.78% as on September 2015 against 2.46% as of September 2014 and 2.95% as of June 2015.
Other details:NPA Coverage Ratio as on Sep, 2015 at 61.92 % as compared to 54.85% a year ago.Cost to Income Ratio stood at 45.74 % for the half year ended Sep, 2015 as compared to 43.06%.Capital Adequacy Ratio (Basel III) stood at 12.76 % as on Sep, 2015 (RBI norm 9 %), which was recorded at 12.66 % as on Sep, 2014.In terms of RBI circular, the bank has, effective from quarter ended June 2015, included its deposits placed with NABARD, SIDBI and NHB on account of shortfall in lending to priority sector under “Other Assets” until now these were included under investments. Interest income on these deposits has been included under “Interest earned others”. Until now such interest income was included under “Interest earned - income on investments”.Interest on loans and advances fell 6% during the quarter to Rs 1259.48 crore.During the quarter, Other income jumped 49% to Rs 126.51 crore. Commission / Exchange, component of other income, grew 28%to Rs 49.00 crore. Insurance Commission grew 44% to Rs 9.17 crore, Treasury / Trading Income jumped 110% to Rs 38.83 crore and Miscellaneous Income grew 37% to Rs 29.51 crore.
Demand deposits fell 0.22% to Rs 5678.32 crore, savings deposits rose 10% to Rs 21306 crore and Term Deposits fell 7% to Rs 35457 crore.Restructured assets stood at Rs 2486.23 crore and there has not been any major change.Deposits in J&K State grew 9% to Rs 48053 crore, in Rest of India fell 24% to Rs 14389 crore and Whole Bank fell 1% to Rs 62442 crore.Gross advances in J&K State grew 14% to Rs 24545 crore, in Rest of India fell 6% to Rs 23428 crore and overall grew 3% to Rs 47973 crore.Gross advances to agriculture sector were 48%.Credit / Deposit (CD) Ratio (%) stood at 73.22% against 71.57% y-o-y.CASA Ratio (%) stood at 43.22% against 36.69% y-o-y.Branches – Excluding Extension Counters, Controlling Offices & RCC’s stood at 829 against 802 y-o-y.Capital Adequacy Ratio (%) Basel II stood at 13.07% against 13.09%.Capital Adequacy Ratio (%) Basel III stood at 12.76% against 12.66%.The banks operating in J&K have extended credit of Rs 8080.21 crore to 214155 beneficiaries during the first six months of 2015-16 thereby registering an achievement of 34.23% of the Annual Credit Plan (ACP) target in financial terms.
J&K Bank alone has disbursed Rs 5337.53 crore to 116207 beneficiaries, which accounts for 66% of the total credit disbursed by all (46 banks and financial institutions operating in Jammu and Kashmir during the period.The bank has improved its performance somewhat when compared to the corresponding period of the last year and with growth forecasts brightening for the country’s economy it expects a turnaround in the next 3 to 4 quarters.
In the floods aftermath and amid stagnation in the economy, the bank remained focused on balance-sheet cleansing and consolidation, improving the deposit mix besides provisioning enhancement. On all these counts it is moving ahead successfully.
The bank will continue to increase its market share in J&K through increased priority sector lending thereby giving boost to the agriculture and allied activities and craft economy.Increasing brick and mortar presence across the rural landscape of J&K shall remain at the heart of its focus.The bank also plans to increase its lending to tourism sector especially for infra-structural needs.Outside the state, the top rated businesses shall remain its preference within the niche lending markets.During the quarter there was slippage of Rs 202 crore.After the package given by PM Modi, next year is going to be very good.Non-J&K balance sheet grew by 15% the bank is focusing on GoI and top corporate houses.J&K balance sheet grew by 25%.
Jammu and Kashmir bank showing very strong bottom formation signals…A must buy signal for long term investors. From here on the risk reward ratio favours long term investors…Stock giving an opportunity to buy at the very bottom.
Insofar as the investment in Jammu and Kashmir Bank is concerned, I would recommend a “riding on the shoulders of giants” investment strategy. So many big and renowned investors hold stake in this bank that the job of retail investors is quite simple. We just have to time our purchase in Jammu and Kashmir bank.
And retail investors like us will not get such multiple and strong clear cut bullish signals than the present signals.
Disclosure: I am not invested in Jammu And Kashmir bank as of now…
Incidentally, Vijay Bank too is showing similar bullish signals.
CONFERENCE CALL - from Capital Markets
Expects to maintain NIM at 3.8-4.0%, asset quality stress to continue for few more quarters
Jammu & Kashmir Bank conducted a conference call on 27 May 2016 to discuss the financial results for the quarter ended March 2016. Mushtaq Ahmad, Chairman & Chief Executive Officer of the bank addressed the call:
Thanks Vishnu, do you have access to the q&a also? Couldn’t find teh transcript on their website yet
