BANK OF BARODA 2023-24 Annual Report Analysis

Wed, 12 Jun

BANK OF BARODA has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the bank during the year 2023-24.

BANK OF BARODA Income Statement Analysis

• Interest income during the year rose 25.3% on a year-on-year (YoY) basis.
• Interest expenses were up by 40.0% YoY during the same period.
• Operating expenses increased by 12.0% YoY during the year.
• The bank's net interest income (NII) increased by 8.8% YoY during the fiscal. Consequently, net interest margins (NIM) witnessed a decline and stood at 3.2% in FY24 as against 3.3% in FY23.
• Other income increased by 43.8% YoY during the year.
• Net profit for the year increased by 25.9% YoY.
• Net profit margins during the year increased to 15.9% in FY24 from 15.8% in FY23.

BANK OF BARODA Income Statement – 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Interest Income	Rs m	945,026	1,183,792	25.3%
Other Income	Rs m	162,754	233,995	43.8%
Interest Expense	Rs m	499,422	698,991	40.0%
Net Interest Income	Rs m	445,604	484,801	8.8%
Operating Expense	Rs m	306,445	343,368	12.0%
Pre-provision Operating Profit	Rs m	301,913	375,428	24.3%
Provisions & Contingencies	Rs m	155,035	191,332	23.4%
Profit before tax	Rs m	205,645	257,994	25.5%
Tax	Rs m	58,767	73,897	25.7%
Profit after tax	Rs m	149,052	187,674	25.9%
Minority Interest	Rs m	-1,000	-1,015	-1.5%
Net Interest Margin	%	3.3	3.2
Net profit margin	%	15.8	15.9

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BANK OF BARODA Balance Sheet Analysis

• The bank's deposits during FY24 stood at Rs 13,518.0 bn as compared to Rs 12,346.8 bn in FY23, thereby witnessing an increase of 9.5%.
• Advances for the year stood at Rs 10,889.8 bn as compared to Rs 9,636.5 bn during FY23, a rise of 13.0%.
• Cost of deposits for BANK OF BARODA rose 30.5% and stood at 4.5%, while yield on advances rose to 8.0%.
• The lender's investments rose to Rs 4,071.4 bn during the year from Rs 3,974.9 bn in FY23.
• Borrowing stood at Rs 1,019.6 bn, a fall of 5.5% as compared to previous year.
• Overall, the total assets and liabilities for FY24 stood at Rs 16,547.8 bn as against Rs 15,258.8 bn during FY23, thereby witnessing a rise of 8.4%.

BANK OF BARODA Balance Sheet – as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	1,050,547	1,197,122	14.0%
Advances	Rs m	9,636,518	10,889,834	13.0%
Deposits	Rs m	12,346,820	13,518,018	9.5%
Yield on advances	%	6.9	8.0
Cost of Deposits	%	3.5	4.5
Investments	Rs m	3,974,872	4,071,363	2.4%
Borrowings	Rs m	1,079,102	1,019,591	-5.5%
Total Assets	Rs m	15,258,790	16,547,794	8.4%

Current Valuations for BANK OF BARODA

• The trailing twelve-month earnings per share (EPS) of the bank stands at Rs 36.3, an improvement from the EPS of Rs 28.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 278.4, stands at 6.2 times its trailing twelve months earnings.
• The price to adjusted book value (P/ABV) ratio at current price levels stands at 1.2 times, while the price to income ratio stands at 1.0 times.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Income per share (Unadj.)	Rs	182.7	228.9
Earnings per share (Unadj.)	Rs	28.8	36.3
Diluted earnings per share	Rs	28.8	36.3
Avg P/E ratio	Rs	5.0	6.2
Avg P/ABV ratio	Rs	0.9	1.2
Avg Market Cap	Rs	742,349	1,165,108
Dividends per share (Unadj.)	Rs	5.50	7.60

Ratio Analysis for BANK OF BARODA

• Efficiency Ratios

  Credit/Deposit Ratio: The bank's credit/deposit ratio improved and stood at 80.6x during FY24, from 78.0x during FY23. The credit/deposit ratio tells us how much money a bank has raised in the form of deposits and has deployed as loans.

  Debt to Equity Ratio: The bank's debt to equity ratio decreased and stood at 12.14x during FY24, from 12.78x during FY23. The debt to equity ratio of a bank tells us how much debt a bank uses relative to its equity.

• Liquidity Ratios

  Capital Adequacy Ratio (CAR): BANK OF BARODA's capital adequacy ratio (CAR) was at 16.3% as on 31 March 2024 as compared to 16.2% a year ago. This ratio helps measure the financial strength of the bank or any finance company to meet their obligations using their assets and capital.

  A bank that has a good CAR has enough capital to absorb potential losses. Thus, it has less risk of becoming insolvent and losing depositor's money.

  Provision Coverage Ratio (PCR): Apart from CAR, you also need to take a look at the bank's PCR and LCR ratios. Provisioning coverage ratio (PCR) is the percentage of funds that a bank sets aside for covering losses due to bad debts.

  So a high PCR ratio means asset quality issues are under control and the bank is not vulnerable.

  Liquidity Coverage Ratio (LCR): The LCR is designed to ensure that banks hold a sufficient reserve of high-quality liquid assets to allow them to survive a period of significant liquidity stress lasting 30 calendar days.

• Profitability Ratios

  Return on Equity (ROE): The return on equity (ROE) ratio for the bank improved and stood at 15.7% during FY24, from 14.2% during FY23. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

  Return on Assets (ROA): The return on asset (ROA) ratio of the bank improved and stood at 1.13% during FY24, from 0.98% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

  Return on Capital Employed (ROCE): The ROCE for the bank improved and stood at 15.84% during FY24, from 13.33% during FY23. The ROCE measures the ability of a bank to generate profits from its total capital (shareholder capital plus debt capital) employed in the bank.

• NPA Ratios

  Gross NPA Ratio: The gross NPA ratio is the ratio of a bank's gross NPAs to gross advances. BANK OF BARODA's gross NPA ratio stood at 2.9% as of 31 March 2024 compared to 3.8% in the same period a year ago.

  A high gross NPA ratio is a bad thing as it indicates how much of a bank's loans are in danger of not being repaid.

  Net NPA Ratio: In simple language, net NPAs are simply the total non-performing assets minus the provision left aside. It gives you the exact value of NPAs after the bank has made provisions.

  The net NPA ratio of BANK OF BARODA was 0.7% in financial year 2024. This compared with 0.9% a year ago.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Credit/Deposit Ratio	x	78.0	80.6
Debt to Equity Ratio	x	12.8	12.1
Loans / Deposits	x	0.1	0.1
Capital Adequacy Ratio	%	16.2	16.3
Return on Equity	%	14.2	15.7
Return on Assets	%	1.0	1.1
Return on Capital Employed	%	13.3	15.8
% of Gross NPAs	%	3.8	2.9
% of Net NPAs	%	0.9	0.7
Yield on Advances	x	6.9	8.0
Yield on Investments	x	6.6	7.4

To see how BANK OF BARODA has performed over the last 5 years, please visit here.

BANK OF BARODA Share Price Performance

Over the last one year, BANK OF BARODA share price has moved up from Rs 187.0 to Rs 278.4, registering a gain of Rs 91.4 or around 48.9%.

Meanwhile, the S&P BSE BANKEX is trading at 57,139.9 (up 0.8%). Over the last one year it has moved up from 49,827.9 to 57,139.9, registering a gain of 7,312.0 points (up 14.7%).

Overall, the S&P BSE SENSEX is up 22.7% over the year.

(To know more, you can check out historical annual results for BANK OF BARODA here and quarterly results for BANK OF BARODA here)