UCO Bank (UCOBANK) Q2 24/25 earnings summary

Executive summary

• Net profit for Q2 FY25 rose 50% year-over-year to ₹603 crore, with operating profit up 45.82% to ₹1,432 crore and net interest income up 20.03% to ₹2,301 crore.

• Advances grew 18% year-over-year to ₹197,927 crore, deposits increased 10.57% to ₹275,777 crore, and total business reached ₹4,73,704 crore, up 13.56%.

• RAM segment advances rose 20% year-over-year, led by retail (29.36%), home loans (19%), and vehicle loans (38.66%).

• Board approved reviewed standalone and consolidated financial results for the quarter and half year ended 30th September 2024; statutory auditors issued an unmodified review opinion.

• Asset quality improved: gross NPA ratio declined to 3.18% (down 96 bps YoY), net NPA to 0.73% (down 38 bps YoY), and PCR rose to 95.92%.

Financial highlights

• Net interest income for Q2 FY25 was ₹2,301 crore, up 20.03% year-over-year; non-interest income surged 53% year-over-year.

• Operating income increased 28.47% year-over-year to ₹3,294 crore; cost-to-income ratio improved to 56%.

• Return on assets (annualized) at 0.75%, and return on equity at 14.22% for Q2 FY25.

• Earnings per share (not annualized) for Q2 FY25 stood at ₹0.50; standalone EPS at ₹0.46, consolidated EPS at ₹0.51.

• Provision coverage ratio for non-performing loans at 95.94% as of 30th September 2024.

Outlook and guidance

• Deposit growth guidance of 8-10%, with actual growth at 10.57% for the quarter; credit growth guidance of 12-14%, actual at 18%.

• CASA growth guidance of 8-10%, achieved 8.09% in the quarter; CD ratio target set at 75% by March 2025, currently at 71.77%.

• Confident of achieving 14% credit growth target, supported by strong pipeline and seasonal uptick.

• Bank plans to raise up to ₹4,000 crore in equity capital in FY25.

• No new funds were raised during the quarter; all previously raised funds have been fully utilized as per stated objectives.