3QFY2012 Result Update | Banking

February 10, 2012

Indian Bank
Performance Highlights

NEUTRAL
CMP Target Price
2QFY12 1,135 921 469 % chg (qoq) 3.1 (1.0) 12.2 3QFY11 1,038 812 491 % chg (yoy) 12.8 12.3 7.0

`241
-

Particulars (` cr) NII Pre-prov. profit PAT

3QFY12 1,170 912 526

Investment Period
Stock Info Sector Market Cap (` cr) Beta 52 Week High / Low Avg. Daily Volume Face Value (`) BSE Sensex Nifty Reuters Code Bloomberg Code

Banking 10,355 1.0 254/167 32,103 10 17,749 5,382 INBA.BO INBK@IN

Source: Company, Angel Research

For 3QFY2012, Indian Bank reported net profit growth of 7.0% yoy (up 12.2% qoq) to `526cr, above our estimate, primarily due to reversal of `52cr of tax liability during the quarter. We recommend Neutral on the stock. NIM declines sequentially; NPA levels rise qoq: Advances for the bank grew by 1.8% qoq (18.2% yoy) and deposits grew by 2.4% qoq (17.8% yoy). CASA deposits growth was relatively healthy at 3.8% qoq (11.1% yoy), leading to a 41bp sequential rise in CASA ratio to 30.2%. CASA deposit growth was mainly on account of healthy traction in saving account deposits, which grew by 6.1% qoq. The banks yield on advances declined by 41bp qoq to 11.7%, while cost of deposits increased by 26bp qoq to 6.9%, leading to an 18bp qoq fall in reported NIM to 3.6%. The bank witnessed a sequential decline of 16.5% in fee income during 3QFY2012 to `235cr. Treasury income also declined by 12.5% qoq to `18cr, while recoveries were also low for 3QFY2012, declining by 29.9% qoq to `28cr. NPA levels of the bank rose sequentially, with absolute gross NPAs increasing by 13.6% qoq and net NPA increasing by 16.7% qoq. Provision coverage ratio of the bank declined by 285bp qoq to 76.5% compared to 79.4% in 2QFY2012 and 84.1% in 1QFY2012. Slippage levels, which had risen sharply in 2QFY2012 to `380cr on account of switchover to system-based NPA recognition and due to a few chunky accounts slipping into NPA, declined to `293cr (slippage ratio of 1.6%). As of 3QFY2012, the banks restructured book stood at `5,573cr. The bank restructured accounts worth `421cr during 3QFY2012, of which ~`300cr was on account of restructuring of GTL (also led to NPV hit of `36cr in the P&L). Outlook and valuation: At the CMP, the stock is trading at 1.0x compared to its five-year range of 0.8x-1.3x. The current valuations of 1.0x are relatively high compared to peers, which are trading at 0.6-0.8x FY2013E ABV. As these relatively high valuations are primarily attributable to the banks high NIM, which may not sustain in the medium term, we believe the risk-return trade-off in case of Indian Bank is less favorable. Hence, we recommend Neutral on the stock.

Shareholding Pattern (%) Promoters MF / Banks / Indian Fls FII / NRIs / OCBs Indian Public / Others 80.0 4.9 9.1 5.9

Abs. (%) Sensex Indian Bank

3m 2.7 13.0

1yr 2.1 16.7

3yr 84.9 110.0

Key financials
Y/E March (` cr) NII % chg Net profit % chg NIM (%) EPS (`) P/E (x) P/ABV (x) RoA (%) RoE (%)
Source: Company, Angel Research

FY2010 3,161 21.2 1,555 24.9 3.5 35.1 6.9 1.6 1.7 25.6

FY2011 4,036 27.7 1,714 10.2 3.7 38.8 6.2 1.3 1.5 23.5

FY2012E 4,547 12.7 1,903 11.0 3.5 43.4 5.5 1.1 1.4 22.0

FY2013E 5,058 11.2 1,828 (4.0) 3.4 41.7 5.8 1.0 1.2 18.2

Vaibhav Agrawal
022 3935 7800 Ext: 6808 vaibhav.agrawal@angelbroking.com

Varun Varma
022 3935 7800 Ext: 6847 varun.varma@angelbroking.com

Please refer to important disclosures at the end of this report

Indian Bank | 3QFY2012 Result Update

Exhibit 1: 3QFY2012 performance

Particulars (` cr) Interest earned - on Advances / Bills - on investments - on balance with RBI & others - on others Interest Expended Net Interest Income Other income Other income excl. treasury - Fee Income - Treasury Income - Recoveries from writ.-off acc Operating income Operating expenses - Employee expenses - Other Opex Pre-provision Profit Provisions & Contingencies - Provisions for NPAs - Provisions for investments - Other Provisions PBT Provision for Tax PAT Effective Tax Rate (%)
Source: Company, Angel Research

3QFY12 2QFY12 % chg (qoq) 3QFY11 % chg (yoy) 3,224 2,494 725 5 2,054 1,170 281 263 235 18 28 1,451 540 372 168 912 236 117 53 66 675 150 526 22.1 3,035 2,356 675 3 1,899 1,135 342 321 281 21 40 1,478 557 367 190 921 220 102 96 22 701 232 469 33.1 6.2 5.9 7.4 32.1 NA 8.1 3.1 (17.8) (18.2) (16.5) (12.5) (29.9) (1.8) (3.1) 1.5 (11.8) (1.0) 7.2 15.0 (45.2) 196.4 (3.6) (35.5) 12.2 (1096)bp 2,392 1,803 582 6 1,354 1,038 249 222 155 27 23 1,286 474 333 142 812 54 28 21 5 758 267 491 35.2 34.8 38.3 24.5 (30.4) NA 51.7 12.8 13.1 18.6 51.5 (31.9) 21.9 12.8 13.7 11.8 18.3 12.3 340.9 318.8 150.7 1,354.1 (10.9) (44.0) 7.0 (1308)bp

Exhibit 2: 3QFY2012 actual vs. Angel estimates

Particulars (` cr) NII Non-interest income Operating income Operating expenses Pre-prov. profit Provisions & cont. PBT Prov. for taxes PAT Source: Company, Angel Research Actual 1,170 281 1,451 540 912 236 675 150 526 Estimates 1,157 300 1,457 548 909 231 678 220 458 Var. (%) 1.1 (6.2) (0.4) (1.5) 0.3 2.1 (0.4) (32.0) 14.8

February 10, 2012

Indian Bank | 3QFY2012 Result Update

Exhibit 3: 3QFY2012 performance

Particulars Balance sheet Advances (` cr) Deposits (` cr) Credit-to-Deposit Ratio (%) Current deposits (` cr) Saving deposits (` cr) CASA deposits (` cr) CASA ratio (%) CAR (%) Tier 1 CAR (%) Profitability Ratios (%) Cost of deposits Yield on advances Yield on investments Reported NIM Cost-to-income ratio Asset quality Gross NPAs (` cr) Gross NPAs (%) Net NPAs (` cr) Net NPAs (%) Provision Coverage Ratio (%) Slippage ratio (%) NPA to avg. assets (%)
Source: Company, Angel Research

3QFY12 87,337 73.4 6,430 29,489 35,919 30.2 11.8 9.6 6.9 11.7 7.6 3.6 37.2 1,190 1.4 695 0.8 76.5 1.6 0.3

2QFY12 %chg (qoq) 3QFY11 85,765 73.8 6,813 27,804 34,617 29.8 12.2 9.9 6.6 12.1 7.6 3.8 37.7 1,048 1.2 596 0.7 79.4 2.0 0.3 1.8 (39)bp (5.6) 6.1 3.8 41bp (39)bp (34)bp 26bp (41)bp 7bp (18)bp (49)bp 13.6 14bp 16.7 11bp (285)bp (46)bp 3bp 73,919 73.2 6,358 25,972 32,330 32.0 12.4 9.7 5.4 10.4 7.2 3.8 36.9 752 1.0 417 0.6 83.0 1.6 0.1

%chg (yoy) 18.2 17.8 23bp 1.1 13.5 11.1 (181)bp (51)bp (14)bp 150bp 131bp 41bp (26)bp 30bp 58.3 33bp 66.7 23bp (651)bp (4)bp 25bp

118,970 116,218

2.4 101,015

Business growth moderate; NIMs decline sequentially

Advances for the bank grew by 1.8% qoq (18.2% yoy) and deposits grew by 2.4% qoq (17.8% yoy). CASA deposits growth was relatively healthy at 3.8% qoq
(11.1% yoy), leading to a 41bp sequential rise in CASA ratio to 30.2%. CASA deposit growth was mainly on account of healthy traction in saving account deposits, which grew by 6.1% qoq. The banks yield on advances declined by 41bp qoq to 11.7%, while cost of deposits increased by 26bp qoq to 6.9%, leading to an 18bp qoq fall in reported NIM to 3.6%.

February 10, 2012

Indian Bank | 3QFY2012 Result Update

Exhibit 4: Business growth trends

Adv. qoq chg (%) 12.0 10.0 8.0 6.0 4.0 73.2 71.1 Dep. qoq chg (%) 74.7 73.8 73.4 CDR (%, RHS) 76.0 74.0 72.0 70.0

Exhibit 5: CASA ratio near 30% levels

CASA ratio 33.0 32.0 31.0 30.0 22.7 15.1 15.0 9.5 11.1 10.0 20.0 CASA yoy growth (%, RHS) 30.0

32.0

30.8

31.0

29.8

6.5 3.1

1.8 4.7

9.6 4.4

3.9 5.2

3QFY11 4QFY11 1QFY12 2QFY12 3QFY12

Source: Company, Angel Research

1.8 2.4

2.0

68.0

28.0 3QFY11 4QFY11 1QFY12 2QFY12 3QFY12

30.2

29.0

Source: Company, Angel Research

Exhibit 6: Reported NIM declines on a sequential basis

4.00 3.80 3.60 3.40 3.20 3.00 3QFY11 4QFY11 1QFY12 2QFY12 3QFY12 3.43

Exhibit 7: 72 branches opened during 9MFY2012

Branches ATMs (RHS) 1,241 1,179 1,128 1,085 1,209 1,300 1,250 1,200 1,150 1,950

3.84

3.86

3.76 3.58

1,900 1,850 1,800 1,750

1,822

1,863

1,895

1,927

1,935

1,100 1,050 1,000

3QFY11 4QFY11 1QFY12 2QFY12 3QFY12

Source: Company, Angel Research

Source: Company, Angel Research

Fee income disappoints

The bank witnessed a sequential decline of 16.5% in fee income during 3QFY2012 to `235cr. Treasury income also declined by 12.5% qoq to `18cr. Recoveries were also low for 3QFY2012, declining by 29.9% qoq to `28cr.

NPA levels rise sequentially

NPA levels of the bank rose sequentially with absolute gross NPAs increasing by 13.6% qoq and net NPA increasing by 16.7% qoq. Provision coverage ratio of the bank declined by 285bp qoq to 76.5% compared to 79.4% in 2QFY2012 and 84.1% in 1QFY2012. Slippage levels, which had risen sharply in 2QFY2012 to `380cr on account of switchover to system-based NPA recognition and due to a few chunky accounts slipping into NPA, declined to `293cr (slippage ratio of 1.6%). As of 3QFY2012, restructured book of the bank stood at `5,573cr. The bank restructured loans of `421cr during 3QFY2012, of which ~`300cr was on account of restructuring of GTL (also led to NPV hit of `36cr in the P&L). The bank is expected to restructure Uttar Haryana SEB (exposure of ~`900cr) and Rajasthan SEB (exposure of ~`1,000cr) in 4QFY2012.

February 10, 2012

Indian Bank | 3QFY2012 Result Update

Exhibit 8: PCR ratio has come off during FY2012

Gross NPAs (%) 1.5 1.0 0.5 83.0 84.3 Net NPAs (%) 84.1 79.4 76.5 NPA coverage (%, RHS) 86.0 84.0 82.0 80.0 78.0 76.0 74.0 72.0

Exhibit 9: Slippage levels decline on a qoq basis

Slippages (%) 2.5 2.0 1.5 1.0 0.3 0.1 0.2 0.3 0.8 Credit cost (%, RHS) 1.0 0.8 0.6 0.4 0.2 3QFY11 4QFY11 1QFY12 2QFY12 3QFY12

1.0 0.6

1.0 0.5

1.0 0.5

1.2 0.7

1.4 0.8

1.6

1.9

0.9

2.0

3QFY11

4QFY11

1QFY12

2QFY12

3QFY12

Source: Company, Angel Research

Source: Company, Angel Research

Exhibit 10: Cost-to-income ratio under control

Staff exps (` cr) Other opex (` cr) CIR (%, RHS)

Exhibit 11: Opex-to-average asset trends

Cost-to-income ratio (%) 40.0 39.0 38.0 37.0 36.0 35.0 34.0 33.0 32.0 Opex to average assets (%, RHS) 1.7 1.7 1.6 1.6 1.6 1.8 1.7 1.7 1.6 1.6 1.5 3QFY11 4QFY11 1QFY12 2QFY12 3QFY12
Source: Company, Angel Research

600 450 300

36.9

190

34.7

38.9

37.7

37.2

142

139

168

40.0 30.0 20.0

333

309

359

367

372

150 -

170

10.0 -

36.9

34.7

38.9

37.7

3QFY11

4QFY11

1QFY12

2QFY12

Source: Company, Angel Research

Investment arguments
Indian Bank's performance has broadly been positive and balanced since its listing in 2007, leading to a gradual improvement in the quality of earnings, visible amongst other things in the substantial 80bp decline in the bank's operating costs as a percentage of assets. Additionally, the bank's CMD has a five-year tenure, which provides a reasonable strategic stability to the bank.

Relatively high yield on advances, with resilient asset quality

A large part of the banks credit book comprises SME and mid-size corporates, contributing relatively high yield on advances but, at the same time, maintaining superior asset quality with net NPA ratio of less than 1%.

Technologically efficient branch franchise, moderate CASA

Indian Bank opened 107 branches in FY2011, taking its total branch network to 1,927 with 100% CBS. The bank has moderate CASA of 29.8%, with CASA reporting an 18.3% CAGR during FY200711 and growing by 9.5% yoy in 2QFY2012.

February 10, 2012

3QFY12

37.2

1.6

0.5

Indian Bank | 3QFY2012 Result Update

Investment concerns
Relatively high yields
A larger portion of SME and mid-corporate loans has contributed to the banks relatively high yield on advances, while asset quality has held up reasonably so far, resulting in the bank enjoying one of the highest risk-adjusted yields in its peer group (90bp higher than sector average in FY2011). This has supported its NIM, which in FY2011 was higher than even larger banks having 40% CASA deposits vs. Indian Banks 30%. Past experience shows that banks that delivered high NIM on the back of high yields later paid the price for the higher risk taken in the form higher NPAs in subsequent years. Accordingly, going ahead, as in case of other banks with unsustainably high yields, we are cautious on the banks asset quality and NIM outlook.

Outlook and valuation

At the CMP, the stock is trading at 1.0x compared to its five-year range of 0.8x-1.3x. The current valuations of 1.0x are relatively high than peers, which are trading at 0.6x-0.8x FY2013E ABV. As these relatively high valuations are primarily attributable to the banks high NIM, which may not sustain in the medium term, we believe the risk-return trade-off in case of Indian Bank is less favorable. Hence, we recommend a Neutral rating on the stock.

February 10, 2012

Indian Bank | 3QFY2012 Result Update

Exhibit 12: Key assumptions

Particulars (%) Credit growth Deposit growth CASA ratio NIM Other income growth Growth in staff expenses Growth in other expenses Slippages Coverage ratio
Source: Company, Angel Research

Earlier estimates FY2012E 17.0 15.0 30.5 3.5 3.6 12.0 14.0 1.9 78.0 FY2013E 14.0 14.0 30.4 3.4 2.4 13.0 15.0 2.2 75.0

Revised estimates FY2012E 17.0 15.0 30.5 3.5 3.6 12.0 14.0 1.8 77.0 FY2013E 14.0 14.0 30.4 3.4 2.4 13.0 15.0 2.1 75.0

Exhibit 13: Change in estimates

Particulars (` cr) NII Non-interest income Operating income Operating expenses Pre-prov. profit Provisions & cont. PBT Prov. for taxes PAT Earlier estimates 4,506 1,224 5,730 2,169 3,561 964 2,597 843 1,755 FY2012 Revised % chg estimates 4,547 0.9 1,224 5,771 2,169 3,602 883 2,719 816 1,903 0.7 1.1 (8.4) 4.7 (3.2) 8.5 FY2013 Earlier estimates 5,011 1,254 6,265 2,465 3,800 1,083 2,717 881 1,835 Revised % chg estimates 5,058 0.9 1,254 6,312 2,465 3,847 1,141 2,706 878 1,828 0.8 1.2 5.3 (0.4) (0.4) (0.4)

Source: Company, Angel Research

Exhibit 14: P/ABV bands

Price(`) 450 400 350 300 250 200 150 100 50 0 0.5x 0.8x 1.1x 1.4x 1.7x

Sep-07

Sep-08

Sep-09

Sep-10

Dec-07

Dec-08

Dec-09

Dec-10

Sep-11

Jun-07

Jun-08

Jun-09

Jun-10

Jun-11

Mar-07

Mar-08

Mar-09

Mar-10

Mar-11

Dec-11

Source: Company, Angel Research

February 10, 2012

Mar-12

Indian Bank | 3QFY2012 Result Update

Exhibit 15: Recommendation summary

Company AxisBk FedBk HDFCBk ICICIBk* SIB YesBk AllBk AndhBk BOB BOI BOM CanBk CentBk CorpBk DenaBk IDBI# IndBk IOB J&KBk OBC PNB SBI* SynBk UcoBk UnionBk UtdBk VijBk Reco. Buy Neutral Neutral Buy Neutral Accumulate Neutral Neutral Accumulate Neutral Neutral Accumulate Reduce Accumulate Accumulate Accumulate Neutral Neutral Accumulate Neutral Accumulate Accumulate Accumulate Neutral Accumulate Accumulate Reduce CMP (`) 1,117 417 516 928 26 347 179 117 823 366 56 526 101 474 90 105 241 101 816 303 1,006 2,173 112 79 251 78 62 Tgt. Price (`) 1,423 1,129 398 907 553 90 540 102 113 877 1,079 2,364 122 265 89 54 Upside (%) 27.4 21.6 14.8 10.1 5.0 (11.1) 14.0 13.4 7.3 7.6 7.2 8.8 8.7 5.8 13.3 (13.1) FY2013E P/ABV (x) 1.8 1.1 3.5 1.7 1.3 2.2 0.8 0.8 1.1 1.1 0.8 1.0 1.0 0.8 0.6 0.7 1.0 0.7 0.8 0.8 1.2 1.8 0.7 1.0 1.0 0.7 0.9 FY2013E Tgt. P/ABV (x) 2.3 2.1 2.5 1.3 1.1 0.9 0.9 0.7 0.8 0.9 1.3 1.9 0.8 1.1 0.8 0.8 FY2013E P/E (x) 9.7 9.0 18.0 14.5 7.9 11.5 5.0 5.5 6.3 7.7 5.7 6.8 6.5 5.1 4.2 5.3 5.8 5.3 4.7 6.6 6.4 10.5 4.7 5.1 6.3 4.4 6.9 FY11-13E CAGR in EPS (%) 18.2 16.2 30.4 19.5 13.5 20.1 9.1 (2.9) 9.8 2.3 26.3 (7.4) (25.1) (1.8) 7.3 8.9 3.6 5.3 16.7 (5.9) 6.4 26.0 13.7 10.9 0.1 15.3 0.7 FY2013E RoA (%) 1.5 1.2 1.8 1.4 0.9 1.4 0.9 0.9 1.1 0.6 0.7 0.8 0.4 0.8 0.8 0.6 1.2 0.5 1.4 0.7 1.0 0.8 0.7 0.6 0.7 0.6 0.4 FY2013E RoE (%) 20.2 13.2 21.0 14.5 17.5 20.6 17.3 15.1 19.3 13.7 16.9 15.8 11.4 15.5 16.1 13.4 18.2 12.8 19.0 11.3 19.4 17.9 16.5 15.4 15.8 14.4 11.1

Source: Company, Angel Research; Note: *Target multiples=SOTP Target Price/ABV (including subsidiaries), # Without adjusting for SASF

February 10, 2012

Indian Bank | 3QFY2012 Result Update

Income statement
Y/E March (` cr) NII - YoY Growth (%) Other Income - YoY Growth (%) Operating Income - YoY Growth (%) Operating Expenses - YoY Growth (%) Pre-Provision Profit - YoY Growth (%) Prov. & Cont. - YoY Growth (%) Profit Before Tax - YoY Growth (%) Prov. for Taxation - as a % of PBT PAT - YoY Growth (%) Preference Dividend PAT avl. To equity sh. - YoY Growth (%) FY07 1,872 24.0 823 54.9 2,695 32.0 1,247 15.5 1,448 50.6 564 40.6 884 57.7 124 14.1 760 50.6 36 723 43.4 FY08 1,992 6.4 1,068 29.7 3,060 13.5 1,400 12.3 1,659 14.6 424 (24.8) 1,235 39.7 226 18.3 1,009 32.8 40 969 33.9 FY09 2,609 31.0 1,035 (3.0) 3,644 19.1 1,415 1.1 2,229 34.3 443 4.3 1,786 44.6 541 30.3 1,245 23.5 43 1,203 24.1 FY10 3,161 21.2 1,316 27.1 4,478 22.9 1,730 22.3 2,747 23.3 396 (10.6) 2,352 31.7 797 33.9 1,555 24.9 46 1,509 25.5 FY11 4,036 27.7 1,182 (10.2) 5,218 16.5 1,926 11.3 3,292 19.8 657 66.1 2,634 12.0 920 34.9 1,714 10.2 46 1,668 10.5 FY12E 4,547 12.7 1,224 3.6 5,771 10.6 2,169 12.6 3,602 9.4 883 34.3 2,719 3.2 816 30.0 1,903 11.0 37 1,866 11.9 FY13E 5,058 11.2 1,254 2.4 6,312 9.4 2,465 13.6 3,847 6.8 1,141 29.2 2,706 (0.5) 878 32.4 1,828 (4.0) 37 1,791 (4.0)

Balance sheet
Y/E March (` cr) Share Capital Equity Preference Reserves & Surplus Deposits - Growth (%) Borrowings Tier 2 Capital Other Liab. & Prov. Total Liabilities Cash Balances Bank Balances Investments Advances - Growth (%) Fixed Assets Other Assets Total Assets - Growth (%) FY07 830 430 400 3,011 47,091 15.4 1,936 3,281 56,149 3,729 1,088 20,878 29,058 29.2 551 844 56,149 17.9 FY08 830 430 400 4,381 29.6 1,283 216 2,752 6,433 340 FY09 830 430 400 6,306 18.9 531 300 3,573 6,212 472 FY10 830 430 400 7,442 21.6 657 300 3,932 7,061 1,052 28,268 62,146 20.8 1,580 1,282 20.5 FY11 830 430 400 8,691 19.9 800 1,300 4,293 6,878 1,684 34,784 75,250 21.1 1,606 1,516 20.1 FY12E 830 430 400 10,133 15.0 2,840 1,521 5,019 7,909 2,840 39,640 17.0 1,818 1,769 16.7 FY13E 830 430 400 11,524 14.0 3,234 1,734 5,680 9,016 3,234 45,071 14.0 2,008 2,015 13.9

61,046 72,582

88,228 105,804 121,675 138,709

70,508 84,122 101,389 121,718 142,018 161,712

21,915 22,801 39,839 51,465 37.1 539 1,442 25.6 29.2 1,594 1,578 19.3

88,042 100,368

70,508 84,122 101,389 121,718 142,018 161,712

February 10, 2012

Indian Bank | 3QFY2012 Result Update

Ratio analysis
Y/E March Profitability ratios (%) NIMs Cost to Income Ratio RoA RoE B/S ratios (%) CASA Ratio Credit/Deposit Ratio CAR - Tier I Asset Quality (%) Gross NPAs Net NPAs 1.9 0.4 0.7 0.2 81.3 16.8 3.0 14.3 3.2 1.2 3.6 1.1 2.5 0.1 2.6 1.5 4.1 2.4 1.7 0.2 1.5 18.9 27.7 1.2 0.2 1.5 0.6 79.9 22.5 3.0 10.7 2.3 1.2 3.1 0.7 2.5 0.4 2.9 1.3 4.2 2.2 2.0 0.4 1.6 16.2 25.8 0.9 0.2 0.6 0.0 79.6 28.0 5.0 8.6 1.9 2.1 3.4 0.6 2.8 0.3 3.1 1.1 4.1 1.8 2.3 0.7 1.6 15.3 24.7 0.8 0.2 1.1 0.4 93.6 35.1 6.5 6.9 1.6 2.7 3.4 0.4 3.0 0.4 3.4 1.0 4.4 1.9 2.5 0.9 1.7 15.3 25.6 1.0 0.5 1.5 0.6 84.3 38.8 7.5 6.2 1.3 3.1 3.6 0.6 3.0 0.1 3.2 0.9 4.1 1.7 2.4 0.8 1.5 15.3 23.5 1.9 0.9 1.8 0.4 77.0 43.4 218.0 8.5 5.5 1.1 3.5 3.4 0.7 2.8 0.1 2.9 0.8 3.7 1.6 2.1 0.6 1.4 15.2 22.0 3.1 1.2 2.1 0.7 75.0 41.7 250.4 8.0 5.8 1.0 3.3 3.3 0.8 2.6 0.0 2.6 0.8 3.4 1.6 1.8 0.6 1.2 15.1 18.2 35.4 61.7 14.1 12.3 32.3 65.3 12.9 11.4 31.6 70.9 13.3 11.3 32.2 70.4 12.7 11.1 30.9 71.1 13.6 11.0 30.5 72.4 13.6 11.1 30.4 72.4 13.6 11.2 3.7 46.3 1.5 27.7 3.2 45.8 1.6 25.8 3.5 38.8 1.6 24.7 3.5 38.6 1.7 25.6 3.7 36.9 1.5 23.5 3.5 37.6 1.4 22.0 3.4 39.1 1.2 18.2 FY07 FY08 FY09 FY10 FY11 FY12E FY13E

Slippages
Loan loss prov. /avg. assets Provision Coverage Per Share Data (`) EPS ABVPS DPS Valuation Ratios PER (x) P/ABVPS (x) Dividend Yield DuPont Analysis (%) NII (-) Prov. Exp. Adj. NII Treasury Int. Sens. Inc. Other Inc. Op. Inc. Opex PBT Taxes RoA Leverage (x) RoE

75.0 106.9 127.5 154.7 184.4

February 10, 2012

10

Indian Bank | 3QFY2012 Result Update

Research Team Tel: 022 - 39357800

E-mail: research@angelbroking.com

Website: www.angelbroking.com

DISCLAIMER
This document is solely for the personal information of the recipient, and must not be singularly used as the basis of any investment decision. Nothing in this document should be construed as investment or financial advice. Each recipient of this document should make such investigations as they deem necessary to arrive at an independent evaluation of an investment in the securities of the companies referred to in this document (including the merits and risks involved), and should consult their own advisors to determine the merits and risks of such an investment. Angel Broking Limited, its affiliates, directors, its proprietary trading and investment businesses may, from time to time, make investment decisions that are inconsistent with or contradictory to the recommendations expressed herein. The views contained in this document are those of the analyst, and the company may or may not subscribe to all the views expressed within. Reports based on technical and derivative analysis center on studying charts of a stock's price movement, outstanding positions and trading volume, as opposed to focusing on a company's fundamentals and, as such, may not match with a report on a company's fundamentals. The information in this document has been printed on the basis of publicly available information, internal data and other reliable sources believed to be true, but we do not represent that it is accurate or complete and it should not be relied on as such, as this document is for general guidance only. Angel Broking Limited or any of its affiliates/ group companies shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this report. Angel Broking Limited has not independently verified all the information contained within this document. Accordingly, we cannot testify, nor make any representation or warranty, express or implied, to the accuracy, contents or data contained within this document. While Angel Broking Limited endeavours to update on a reasonable basis the information discussed in this material, there may be regulatory, compliance, or other reasons that prevent us from doing so. This document is being supplied to you solely for your information, and its contents, information or data may not be reproduced, redistributed or passed on, directly or indirectly. Angel Broking Limited and its affiliates may seek to provide or have engaged in providing corporate finance, investment banking or other advisory services in a merger or specific transaction to the companies referred to in this report, as on the date of this report or in the past. Neither Angel Broking Limited, nor its directors, employees or affiliates shall be liable for any loss or damage that may arise from or in connection with the use of this information. Note: Please refer to the important `Stock Holding Disclosure' report on the Angel website (Research Section). Also, please refer to the latest update on respective stocks for the disclosure status in respect of those stocks. Angel Broking Limited and its affiliates may have investment positions in the stocks recommended in this report.

Disclosure of Interest Statement 1. Analyst ownership of the stock 2. Angel and its Group companies ownership of the stock 3. Angel and its Group companies' Directors ownership of the stock 4. Broking relationship with company covered

Indian Bank No No No No

Note: We have not considered any Exposure below ` 1 lakh for Angel, its Group companies and Directors

Ratings (Returns):

Buy (> 15%) Reduce (-5% to 15%)

Accumulate (5% to 15%) Sell (< -15%)

Neutral (-5 to 5%)

February 10, 2012

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