Canara Bank (CANBK) Q2 24/25 earnings summary

Executive summary

• Global business grew 9.42% year-over-year, reaching ₹23.59 lakh crore, with advances at ₹10.11 lakh crore, both up over 9%.

• Net profit rose 11.31% year-over-year, reaching ₹4,014 crore for Q2 FY25, surpassing ₹4,000 crore for the first time in a quarter.

• Asset quality improved with gross NPA at 3.73% (down 103 bps YoY) and net NPA at 0.99% (down 42 bps YoY).

• Provision coverage ratio increased to 90.89%, up 216 bps YoY.

• Retail credit surged 31.27% year-over-year, with housing and vehicle loans up 12.29% and 15.49% respectively.

Financial highlights

• Total income grew 10.32% YoY to ₹34,721 crore; net interest income up 4.63% to ₹9,315 crore.

• Operating profit stable at ₹7,654 crore; provisions declined 9.23% YoY.

• Fee-based income increased 17.68% YoY to ₹2,436 crore.

• Cost-to-income ratio stood at 46.94% for the quarter.

• EPS stood at ₹17.41, up 10.57% YoY.

Outlook and guidance

• FY25 guidance: global business growth 10%, advances 10%, deposits 9%, NIM 2.90%, gross NPA 3.5%, net NPA 1.1%.

• Management expects to exceed FY25 guidance, targeting 11-12% credit growth.

• Most key metrics are on track or ahead of guidance, with ROE at 20.44% and ROA at 1.05%.

• Credit cost guidance for FY25 is below 1%.

• Credit growth expected to remain strong in H2, with peak seasonality in Q3 and Q4.