INY Vysya Bank stock has given 152% returns from our original recommended price of Rs.320. We are placing this stock on watch list. ING Vysya Bank has a weight of 5% and 6% in our 19 stocks and 12 stocks portfolios respectively.
We do not recommend further buying in this stock until clarity emerges on its takeover by Kotak Mahindra Bank. We will hold this stock in our model portfolio until details of takeover emerge.
This bank has posted a marginal 2% increase in the net profit for the quarter ended 30th September 2014. Profit After Tax (PAT) for Q2FY15 was at Rs.1.80 billion compared to Rs.1.76 billion in the corresponding quarter of the previous year and increased by 26% on a sequential quarter on quarter basis.
For ING Vysya Bank Net interest income for the quarter increased by 12.85% to Rs.4.97 billion YoY. Net Interest margin improved by 8 bps to 3.54% compared to 3.46% in Q2FY14. Other income increased significantly by 24% to Rs.2.28 billion in Q2FY15 YoY. Bank had seen strong momentum in its fee income. Provisions and contingencies were higher at Rs.0.49 billion from Rs.0.18 billion in the corresponding quarter of the previous year. Provisions and contingencies were at Rs.1.008 billion in Q1FY15. Overall asset quality was a concern with Gross NPA ratio and Net NPA ratio at 1.59% and 0.42% respectively as in Q2FY15 compared to 1.72% and 0.19% respectively as at Q2FY14. Net non performing advances (NPA) increased to Rs.1.65 billion, which is 2.66% higher compared to Q2FY14. During Q2FY15 bank had sold Mid-Corporate segment NPA account to an asset reconstruction company at 60% of the principal value.
The bank has shown a decent increment of 12% in the deposits to Rs.446.52 billion from Rs.400.30 billion on a year on year basis. CASA ratio was at 33.1% of the total deposits for the quarter ended September 2014.
Bank currently has a Price to book value ratio of 1.66.