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BANDHAN BANK 2022-23 Annual Report Analysis
Fri, 21 Jul

BANDHAN BANK has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the bank during the year 2022-23.

BANDHAN BANK Income Statement Analysis

  • Interest income during the year rose 14.7% on a year-on-year (YoY) basis.
  • Interest expenses were up by 28.9% YoY during the same period.
  • Operating expenses increased by 31.6% YoY during the year.
  • The bank's net interest income (NII) increased by 6.3% YoY during the fiscal. Consequently, net interest margins (NIM) witnessed a decline and stood at 6.8% in FY23 as against 7.1% in FY22.
  • Other income declined by 12.5% YoY during the year.
  • Net profit for the year increased by 1644.6% YoY.
  • Net profit margins during the year increased to 13.8% in FY23 from 0.9% in FY22.

BANDHAN BANK Income Statement – 2022-23

No. of Mths
Year Ending
12
Mar-22*
12
Mar-23*
% Change
Interest Income Rs m 138,716159,04714.7%
Other Income Rs m 28,22524,686-12.5%
Interest Expense Rs m 51,57166,45128.9%
Net Interest Income Rs m 87,14592,5966.3%
Operating Expense Rs m 35,23646,36831.6%
Pre-provision Operating Profit Rs m 80,13470,914-11.5%
Provisions & Contingencies Rs m 78,87648,967-37.9%
Profit before tax Rs m 1,28628,9302149.2%
Tax Rs m 286,98324576.3%
Profit after tax Rs m 1,25821,9461644.6%
Minority Interest Rs m 000.0%
Net Interest Margin % 7.16.8
Net profit margin % 0.913.8
* Results Consolidated
Source: Accord Fintech, Equitymaster



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BANDHAN BANK Balance Sheet Analysis

  • The bank's deposits during FY23 stood at Rs 1,080.7 bn as compared to Rs 963.3 bn in FY22, thereby witnessing an increase of 12.2%.
  • Advances for the year stood at Rs 1,047.6 bn as compared to Rs 939.7 bn during FY22, a rise of 11.5%.
  • Cost of deposits for BANDHAN BANK rose 12.6% and stood at 5.0%, while yield on advances rose to 13.1%.
  • The lender's investments rose to Rs 323.7 bn during the year from Rs 290.8 bn in FY22.
  • Borrowing stood at Rs 247.1 bn, a growth of 24.0% as compared to previous year.
  • Overall, the total assets and liabilities for FY23 stood at Rs 1,557.7 bn as against Rs 1,390.0 bn during FY22, thereby witnessing a rise of 12.1%.

BANDHAN BANK Balance Sheet – as on March 2023

No. of Mths
Year Ending
12
Mar-22*
12
Mar-23*
% Change
Networth Rs m 173,759195,72212.6%
Advances Rs m 939,7491,047,56811.5%
Deposits Rs m 963,3061,080,69312.2%
Yield on advances % 13.013.1
Cost of Deposits % 4.55.0
Investments Rs m 290,787323,65911.3%
Borrowings Rs m 199,212247,10824.0%
Total Assets Rs m 1,389,9521,557,70012.1%
* Results Consolidated
Source: Accord Fintech, Equitymaster



Current Valuations for BANDHAN BANK

  • The trailing twelve-month earnings per share (EPS) of the bank stands at Rs 13.6, an improvement from the EPS of Rs 0.8 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 217.9, stands at 19.5 times its trailing twelve months earnings.
  • The price to adjusted book value (P/ABV) ratio at current price levels stands at 1.8 times, while the price to income ratio stands at 2.7 times.

Per Share Data/Valuations

No. of Mths
Year Ending
12
Mar-22*
12
Mar-23*
Income per share (Unadj.) Rs 86.198.7
Earnings per share (Unadj.) Rs 0.813.6
Diluted earnings per share Rs 0.813.6
Avg P/E ratio Rs 380.619.5
Avg P/ABV ratio Rs 2.61.8
Avg Market Cap Rs 478,800428,241
Dividends per share (Unadj.) Rs 0.001.50
* Results Consolidated
Source: Accord Fintech, Equitymaster



Ratio Analysis for BANDHAN BANK

  • Efficiency Ratios

    Credit/Deposit Ratio: The bank's credit/deposit ratio deteriorated and stood at 96.9x during FY23, from 97.6x during FY22. The credit/deposit ratio tells us how much money a bank has raised in the form of deposits and has deployed as loans.

    Debt to Equity Ratio: The bank's debt to equity ratio increased and stood at 6.78x during FY23, from 6.69x during FY22. The debt to equity ratio of a bank tells us how much debt a bank uses relative to its equity.

  • Liquidity Ratios

    Capital Adequacy Ratio (CAR): BANDHAN BANK's capital adequacy ratio (CAR) was at 19.8% as on 31 March 2023 as compared to 20.1% a year ago. This ratio helps measure the financial strength of the bank or any finance company to meet their obligations using their assets and capital.

    A bank that has a good CAR has enough capital to absorb potential losses. Thus, it has less risk of becoming insolvent and losing depositor's money.

    Provision Coverage Ratio (PCR): Apart from CAR, you also need to take a look at the bank's PCR and LCR ratios. Provisioning coverage ratio (PCR) is the percentage of funds that a bank sets aside for covering losses due to bad debts.

    So a high PCR ratio means asset quality issues are under control and the bank is not vulnerable.

    Liquidity Coverage Ratio (LCR): The LCR is designed to ensure that banks hold a sufficient reserve of high-quality liquid assets to allow them to survive a period of significant liquidity stress lasting 30 calendar days.

  • Profitability Ratios

    Return on Equity (ROE): The return on equity (ROE) ratio for the bank improved and stood at 11.2% during FY23, from 0.7% during FY22. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

    Return on Assets (ROA): The return on asset (ROA) ratio of the bank improved and stood at 1.41% during FY23, from 0.09% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

    Return on Capital Employed (ROCE): The ROCE for the bank improved and stood at 10.01% during FY23, from 2.70% during FY22. The ROCE measures the ability of a bank to generate profits from its total capital (shareholder capital plus debt capital) employed in the bank.

  • NPA Ratios

    Gross NPA Ratio: The gross NPA ratio is the ratio of a bank's gross NPAs to gross advances. BANDHAN BANK's gross NPA ratio stood at 4.9% as of 31 March 2023 compared to 6.5% in the same period a year ago.

    A high gross NPA ratio is a bad thing as it indicates how much of a bank's loans are in danger of not being repaid.

    Net NPA Ratio: In simple language, net NPAs are simply the total non-performing assets minus the provision left aside. It gives you the exact value of NPAs after the bank has made provisions.

    The net NPA ratio of BANDHAN BANK was 1.2% in financial year 2023. This compared with 1.7% a year ago.

Key Ratio Analysis

No. of Mths
Year Ending
12
Mar-22*
12
Mar-23*
Credit/Deposit Ratio x 97.696.9
Debt to Equity Ratio x 6.76.8
Loans / Deposits x 0.20.2
Capital Adequacy Ratio % 20.119.8
Return on Equity % 0.711.2
Return on Assets % 0.11.4
Return on Capital Employed % 2.710.0
% of Gross NPAs % 6.54.9
% of Net NPAs % 1.71.2
Yield on Advances x 13.013.1
Yield on Investments x 5.96.1
* Results Consolidated
Source: Accord Fintech, Equitymaster



To see how BANDHAN BANK has performed over the last 5 years, please visit here.

BANDHAN BANK Share Price Performance

Over the last one year, BANDHAN BANK share price has moved down from Rs 283.3 to Rs 217.9, registering a loss of Rs 65.4 or around 23.1%.

Meanwhile, the S&P BSE BANKEX is trading at 52,122.8 (down 0.2%). Over the last one year it has moved up from 41,784.4 to 52,122.8, registering a gain of 10,338.4 points (up 24.7%).

Overall, the S&P BSE SENSEX is up 20.4% over the year.

(To know more, you can check out historical annual results for BANDHAN BANK here and quarterly results for BANDHAN BANK here)

Annual Report FAQs

What is the current share price of BANDHAN BANK?

BANDHAN BANK currently trades at Rs 188.5 per share. You can check out the latest share price performance of BANDHAN BANK here...

What was the net interest income of BANDHAN BANK in FY23? How does it compare to earlier years?

The net interest income of BANDHAN BANK stood at Rs 92,596 m in FY23, which was up 6.3% compared to Rs 87,145 m reported in FY22.

BANDHAN BANK's net interest income has grown from Rs 44,954 m in FY19 to Rs 92,596 m in FY23.

Over the past 5 years, the net interest income of BANDHAN BANK has grown at a CAGR of 19.8%.

What was the net profit of BANDHAN BANK in FY23? How does it compare to earlier years?

The net profit of BANDHAN BANK stood at Rs 21,946 m in FY23, which was up 1644.6% compared to Rs 1,258 m reported in FY23.

This compares to a net profit of Rs 22,055 m in FY21 and a net profit of Rs 30,237 m in FY20.

Over the past 5 years, BANDHAN BANK''s net profit has grown at a CAGR of 3.0%.

What does the Key Ratio analysis of BANDHAN BANK reveal?

Be it the bank's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of BANDHAN BANK reveals:

  • Net interest margin declined from 7.1% in FY22 to 6.8% in FY23.
  • Net profit margins grew from 0.9% in FY22 to 13.8% in FY23.
  • Debt to Equity ratio for FY23 stood at 6.8 as compared to 6.7 in FY22.

Here's the ratio/financial analysis of BANDHAN BANK for the past 5 years.

 FY19FY20FY21FY22FY23
Net Interest Margin (%)9.07.77.17.16.8
Net Profit Margin (%)29.427.817.60.913.8
Debt to Equity Ratio (x)3.94.85.56.76.8

 

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