South Indian Bank: First Cut; Asset quality continues to weigh on profitability;

 

** NII came in at Rs4.1bn (3% above estimate), up 5% qoq and 27% yoy

** Other income 25% above estimate at Rs1.5bn (4% lower yoy)

** Opex in-line with estimate at Rs3bn (up 14% yoy)

** PPP 20% above estimate driven by higher other income

** Provisions at Rs1.1bn as compared to our estimate Rs720mn

** PAT at Rs1bn (in-line with estimate), +15% yoy and 9% qoq

** GNPA and NNPA up 24% qoq and 30% qoq respectively. PCR dropped further to 35.4% as compared to 38.4% in Q2FY16.

** Stock trades at 0.6x FY17 BV