Bandhan Bank Q4 FY24 Results Preview: PAT, interest income likely to grow in almost double digits; asset quality may improve

Analysts expect Bandhan Bank to stage a largely stable set of financial performance on the back of robust growth in its microfinance business and improving asset quality though a higher cost of funds may dent its margin slightly.

Here's all you need to know about Bandhan Bank's fourth-quarter earnings: 

According to Zee Business research, Bandhan Bank is estimated to register a net profit of Rs 890 crore for the January-March period, which translates into a rise of 10.1 per cent on a year-on-year basis. 

Zee Business analysts estimate Bandhan Bank's March-quarter net interest income (NII) to increase 9.6 per cent to Rs 2,710 crore for the March quarter. 

NII or net interest income is a key measure of income for a financial institution. It is the difference between the interest earned and the interest paid. 

Zee Business analysts expect Bandhan Bank's gross non-performing assets (GNPAs) as a percentage of total loans to stand in the range of 6.1-6.3 per cent for the March quarter, as against 7.02 per cent for the October-December period. They estimate its net non-performing assets (NNPA) to come in at 1.9-2.0 per cent, lower than 2.21 per cent in the fiscal third quarter. 

NIM or net interest margin is a crucial gauge of profitability for lenders. 

While an expanding NIM reflects strong interest income compared to expenses, a shrinking one suggests that the institution's interest income is declining relative to its interest expenses, potentially signaling reduced profitability and efficiency. 

Here are some key takeaways from Bandhan Bank's March-quarter Q4 update

--Q4 FY24 loans up 17.8 per cent vs Q4 FY23

--Q4 FY24 deposits up 25.1 per cent vs Q4 FY23

--Q4 FY24 CASA deposits up 18.1 per cent vs Q4 FY23

As of May 15, the Bandhan Bank stock, part of the Nifty Bank basket, has lost 22.5 per cent of its value so far in 2024, sharply underperforming a gain of 2.1 per cent and a decline of about one per cent in the Nifty50 barometer and the banking gauge, respectively.