DCB Bank (DCBBANK) Q1 24/25 earnings summary

Executive summary

• Advances grew 18.90% year-over-year to INR 42,181 crores and deposits rose 20.19% to INR 51,690 crores in Q1FY25, with CASA up 18% and savings accounts up 21% year-over-year.

• Profit after tax for Q1FY25 was INR 131 crores, up 3% year-over-year.

• Gross NPA stood at 3.33% and Net NPA at 1.18% for Q1FY25.

• The bank focused on granular, secured lending, digital transformation, and technology upgrades in treasury and cybersecurity.

• Strategic asset mix shift underway, emphasizing business loans within the mortgage portfolio and SME overdraft products.

Financial highlights

• Net interest income for Q1FY25 was INR 497 crores, up 5% year-over-year, with NIM at 3.39% for the quarter.

• Fee income reached INR 143 crore, with core fee income at INR 114 crore, up 33% year-over-year.

• Cost to average assets was 2.71%, and cost to income at 67.89% for Q1FY25.

• Provision coverage ratio stood at 76%.

• Balance sheet size reached INR 64,516 crores, up 17.36% year-over-year.

Outlook and guidance

• NIM expected to stabilize and recover after Q3 as term deposit repricing completes and regulatory impacts subside.

• Targeting to double the loan book and balance sheet every 3.5 years, implying 19%-20% annual growth.

• Cost to average assets targeted to decline to 2.5% and cost-to-income ratio to 55% or below.

• ROA and ROE aspirational targets set at 1% and 13%-14%, respectively.

• Promoter capital infusion expected by Q2.