FEDERAL BANK Announces Quarterly Results (2QFY21); Net Profit Down 26.2%

Mon, 19 Oct

FEDERAL BANK has announced its results for the quarter ended September 2020. Here is a detailed performance review of the same:

FEDERAL BANK Quarterly Financials

No. of Mths Qtr. Ending		3 Sep-19*	3 Jun-20*	3 Sep-20*	QoQ Change	YoY Change
Operating income	Rs m	32,543	34,442	34,879	1.3%	7.2%
Other income	Rs m	4,209	4,884	5,093	4.3%	21.0%
Total revenues	Rs m	36,752	39,325	39,972	1.6%	8.8%
Interest	Rs m	21,305	21,477	21,081	-1.8%	-1.1%
Gross Profit	Rs m	11,238	12,964	13,799	6.4%	22.8%
Other expenses	Rs m	8,259	8,524	8,827	3.5%	6.9%
Profit before tax	Rs m	4,670	5,378	4,145	-22.9%	-11.3%
Tax	Rs m	503	1,370	1,069	-22.0%	112.3%
Profit after tax	Rs m	4,167	4,008	3,076	-23.2%	-26.2%
Gross profit margin	%	34.5	37.6	39.6
Effective tax rate	%	10.8	25.5	25.8
Net profit margin	%	12.8	11.6	8.8

Year-on-Year Performance:

• The bank's operating income (interest earned) during the quarter grew 7.2% on a year-on-year (YoY) basis. The interest expended was down by 1.1% YoY during the same period.
• The bank's operating profit increased by 22.8% YoY during the quarter. Consequently, operating profit margins witnessed a growth and stood at 39.6% in 2QFY21 as against 34.5% in 2QFY20.
• Other income increased by 21.0% YoY during the quarter.
• Net profit for the quarter declined by 26.2% YoY. Net profit margins during the quarter declined from 12.8% in 2QFY20 to 8.8% in 2QFY21.

Quarter-on-Quarter Performance:

• The bank's operating income (interest earned) during the quarter grew 1.3% on a quarter-on-quarter (QoQ) basis. The interest expended was down by 1.8% QoQ during the same period.
• The bank's operating profit increased by 6.4% QoQ during the quarter. Consequently, operating profit margins witnessed a growth and stood at 39.6% in 2QFY21 as against 37.6% in 1QFY20.
• Net profit for the quarter declined by 23.2% QoQ, while net profit margins declined from 11.6% in 1QFY20 to 8.8% in 2QFY21.

To see how FEDERAL BANK has performed over the last eight quarters,please visit here.

FREE Event: How to Profit from the Massive Upcoming Revival in Smallcaps

FEDERAL BANK Share Price Performance

Over the last one year, FEDERAL BANK share price has moved down from Rs 84.0 to Rs 54.6, registering a Loss of Rs 29.4 or around 35.0%.

Meanwhile, the S&P BSE BANKEX is trading at Rs 27,293.6 (up 2.3%). Over the last one year it has moved down from 32,900.6 to 27,293.6, a gain of 5,607 points (down 17.0%).

Overall, the S&P BSE SENSEX is up 4.8% over the year.

Current Valuations

At the current price of Rs 54.6, the price to earnings (P/E) ratio of FEDERAL BANK stands at 7.5 times its trailing twelve months earnings, while its price to book value (P/BV) ratio stands at 0.9 times.