ValuePickr Forum

Karnataka bank – private bank @ public sector valuation

Excellent results and a definate candidate for re rating

I saw that the gnpa is still high. Capital adequacy ratio lowest in the last few quarters maybe. Overall results feel good
Disc invIested

Fall in Capital adequacy ratio is leading to equity dilution. The price will adjust accordingly.
Disc : not invested, watching

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SBI says that jet airways account is stressed asset , so does Karnataka bank has also exposure towards jet airways?

Can anyone tell the Quantum of exposure of Karnataka bank towards il&fs

156 cr (0.31% of total advances) Some 32 cr is part of sma2. Remaining is standard. No provisions made so far for ilfs debt.

Disl: invested

In my view, public shareholders should voice their views on passing a resolution for getting it acquired by large banks like HDFC, Kotak, etc. It will unlock value for all the stakeholders involved.

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If possible please share the concall reading

Apart from 156 cr loan they have ~25cr investment exposure too towards IL&FS according to the above research report.

Discl: Invested

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The management is not replying to the investors query. It is a strong mismanagement in their part. I would request how can I escalate this issue? @hitesh2710 @ayushmit

Could we escalate to SEBI?

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I guess we have to creat a whatsapp group and seriously thinks on it…
It will be good for all small share holders if it was merged with larger banks…

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Alternately, a merger with the likes of LVB, South Indian and Karur Vysya should also be looked into. Major competing banks are 8-10 times the size of Ktk bank.

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Very good results from Karnatka bank. More importantly, asset quality has remained stable.


Lets hope, their execution is efficient. The Bank is valued cheap at the moment. I would also prefer that they bring their GNPA under 3.

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e8aab27b-c6c0-4878-a818-208350cd50e5.pdf (753.4 KB)

Karnataka bank posted all time high net profit of 175cr Total business turnover touched Rs.121339cr Deposits with the bank at 68520cr YOY growth of 9.24%…

Net Profit in FY19 is 477 Cr.
Net NPA in Q1FY19 was 1396 Cr.
Net NPA in Q1FY20 is 1760 Cr.

Is it not alarming that a rise of 364 Cr in net NPA compared to 477 Cr profit, especially when we see this NPA % hovering around 3% and not going down in terms of % even when advances are increasing in the past 3 years ?

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The most worrying factor is profit of just 6 crore in retail lending. I guess the provisioning was brutal.
No one is quite sure why.
Signs of things to come?

Anybody attended AGM? Are there any updates from management on future path.

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Average results from Karnataka bank:

Net profit has declined 12.5%. However has seen growth in retail advances and an improvement in CASA to 27%. Both GNPA and Net NPA have increased while PCR has improved to 69%