Syndicate Bank Net profits plunge by 73% YoY : Result Analysis

Syndicate Bank has come out with its Q1 results. Their net profit took a beating due to NPA provisioning, indicating a rough road ahead.
Net revenues increased marginally by 1.51% YoY, but net profit plunged by 73.80%.

heck out the Daily Results Tracker here

Other major analysis points are:

• Operating margin decreased from 17.85% in Q1FY16 to 12.22% in Q1 current year. This was mainly due to operating expense increasing by nearly 43% YoY. Employee cost and other expenses rose by 50% and 30% respectively.
• The provisions have increased by 40% YoY, but the good thing is if we consider QoQ it has decreased by 72.08%. Meaning, most of the NPA’s have now been provisioned.
• Though the advances contracted by 0.72% QoQ, but the gross NPA and net NPA increased by 11.5% each QoQ.
• For Q1 FY16 28.20% of PBT was paid as tax, but for the same quarter last year 45.95% of PBT was paid as tax. This is likely an anomaly last year.
• The share holding percentage of Govt of India increased from 65.17% last quarter to 69.32%. (This is on account of the bailout given to public sector banks in the quarter)
• The only good thing happening over here is writing back of the provisions amounting to 68.82 Crs.
• Syndicate bank has gone a step ahead and has started to make a 2% extra provision on sub standard assets.

Stock prices didn’t react much to the results, and closed 1.3% up.

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