Indian Bank Q2 FY27 Results (NSE: INDIANB)
Signal: Earnings grew
The read
The operating trajectory improved sharply: consolidated operating profit rose 45.6% YoY and operating margin expanded 511bps to 30.33%, but provisions rose 202.0% to ₹2,231.26 crore, limiting PAT growth to 13.9%; asset quality nevertheless improved with gross NPA falling to 1.61% from 2.60% YoY, while consolidated PAT exceeded standalone PAT by ₹78.47 crore through associate earnings.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹23,335.98 Cr | +21.1% | +11.1% |
| EBIT | ₹7,079.62 Cr | +45.6% | |
| Net profit | ₹3,540.71 Cr | +13.9% | |
| EPS | ₹26.29 | +14.0% | |
| EBIT margin | 0% |
P&L walk
Total income rose to ₹23,335.98 crore, +21.1% YoY and +11.1% QoQ; operating profit increased 45.6% to ₹7,079.62 crore as operating expenses rose only 11.4%, but provisions jumped 202.0% to ₹2,231.26 crore, restricting PAT growth to 13.9% at ₹3,540.71 crore.
Segments
Treasury was the largest earnings accelerator, with segment result rising to ₹2,883.26 crore, +83.0% YoY, while Retail Banking remained the largest revenue pool at ₹8,962.82 crore and grew 12.9% YoY; Corporate/Wholesale Banking result increased 43.0% to ₹1,723.91 crore.
Key positives
- Operating profit reached ₹7,079.62 crore, +45.6% YoY versus total-income growth of +21.1%, expanding the operating margin by 511bps to 30.33%.
- Gross NPA improved to 1.61% from 2.60% YoY and net NPA to 0.14% from 0.16%, while advances grew 17.5% YoY to ₹7,11,351.99 crore.
- Treasury segment result increased 83.0% YoY to ₹2,883.26 crore and Corporate/Wholesale Banking result increased 43.0% to ₹1,723.91 crore.
- Operating cash flow strengthened to ₹17,835.73 crore in H1FY27 from ₹5,637.37 crore in H1FY26.
Key concerns
- Provisions and contingencies rose 202.0% YoY to ₹2,231.26 crore and 87.1% QoQ, materially below the 45.6% operating-profit growth conversion into PAT.
- Capital adequacy declined to 16.41% from 17.49% YoY and 17.80% QoQ, although it remained above the disclosed prior periods' levels.
- The bank approved potential infrastructure-bond issuance of up to ₹5,000 crore and AT1/Tier-2 issuance of up to ₹2,000 crore, which could increase funding and capital-market dependence if executed.
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