Canara Bank Q1 FY27 Results (NSE: CANBK)
Signal: Earnings grew
The read
Q1FY27 net profit rose only 2.2% YoY as operating profit growth stayed flat (+1.0%), continuing the trend of decelerating earnings growth seen over the past year. Asset quality improved sharply (GNPA 1.57%, best in last 5 years; PCR 94.76%), which kept credit cost low and supported profit. Loan growth was robust (+18% YoY) led by retail and RAM. However, revenue growth remains sub-2% and the bank's P&L remains heavily reliant on provision savings rather than operating leverage.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹31,839 Cr | +1.1% | +0.6% |
| EBIT | ₹8,636 Cr | +1.0% | |
| Net profit | ₹4,856 Cr | +2.2% | |
| EPS | ₹5.29 | +2.1% | |
| EBIT margin | 11.6% |
P&L walk
Total income (revenue) rose only 1.1% YoY to ₹31,839 Cr; NII growth likely muted as loan growth outpaced deposit growth. Operating profit grew a meagre 1.0% YoY to ₹8,636 Cr, implying cost-to-income pressures. Net profit grew 2.2% YoY to ₹4,856 Cr, entirely from lower provisions (credit cost -23bps to 0.49%). EPS grew 2.1% in line with PAT.
Key positives
- GNPA ratio improved 112bps YoY to 1.57% — lowest in recent history.
- PCR rose to 94.76% (+159bps YoY), providing strong buffer.
- Global advances grew 17.97% YoY, with retail credit surging 35.88% (housing +17.85%, vehicle +26.34%).
Key concerns
- Operating profit growth of just 1.0% YoY — negligible expansion despite loan growth of 18%.
- Total income (revenue) growth of only 1.1% YoY — slowing sharply from prior quarters (Q3FY26 was +0.6%; Q4FY26 was +1.1%).
- Net profit growth (2.2%) continues to decelerate from +24.5% in Q3FY26 and +15.8% in Q2FY26 — trend is weakening.
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