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Punjab & Sind Bank revenue increased slightly on 1.8%

10-05-2016 • About Punjab & Sind Bank ($PSB) • By InTwits

Punjab & Sind Bank reported FY2016 financial results today. Overall the company's long term financial model is characterised by the following facts:
  • The company has potentially unprofitable business model: ROIC is 3.4%
  • It operates with high leverage: Net Debt/EBITDA is 4.2x while industry average is
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.

Revenue and profitability


Punjab & Sind Bank's Revenue increased slightly on 1.8%. Revenue decline was accelerating on average at -5.8 pp per annum in the last 5 years.

Net Income margin increased on 2.3 pp from 1.3% to 3.7% in FY2016. During the last 5 years Net Income margin bottomed in FY2015 at 1.3%.

Investments (CAPEX, working capital and M&A)


In FY2016 the company had CAPEX/Revenue of 0.41%. The company showed small CAPEX/Revenue decline of 0.64 pp from 1.1% in FY2013 to 0.41% in FY2016. For the last three years the average CAPEX/Revenue was 0.68%.

Return on investment


The company operates at low ROIC (3.4%) and ROE (5.8%). ROIC increased on 2.1 pp from 1.3% to 3.4% in FY2016. ROE increased on 3.5 pp from 2.3% to 5.8% in FY2016. During FY2012-FY2016 ROE bottomed in FY2015 at 2.3%.

Leverage (Debt)


Debt dropped on 13.0% while cash increased slightly on 1.8%.

Punjab & Sind Bank has short term refinancing risk: cash is only 64.7% of short term debt.

Financial and operational results


Punjab & Sind Bank ($PSB) key annual financial indicators

mln. INR201220132014201520162016/2015
P&L
Revenue68,91977,34283,99890,29891,9041.8%
Net Income4,5133,3923,0061,2133,360176.9%
Balance Sheet
Cash36,40232,48948,34537,56138,2261.8%
Short Term Debt2,0722,3834,07270,11759,055-15.8%
Long Term Debt81,48525,40116,85013,25013,4401.4%
Cash flow
Capex816582845379-55.1%
Ratios
Revenue growth28.4%12.2%8.6%7.5%1.8%
Net Income Margin6.5%4.4%3.6%1.3%3.7%2.3%
CAPEX, % of revenue1.1%0.7%0.9%0.4%-0.5%
ROIC4.7%3.1%1.3%3.4%2.1%
ROE11.8%7.6%6.1%2.3%5.8%3.5%

Peers in Banks


Below we provide Punjab & Sind Bank benchmarking against other companies in Banks industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.

Top companies by Revenue growth, %

Top 5 FY2012 FY2013 FY2014 FY2015 FY2016
Kotak Mahindra Bank ($KOTAKBANK)18.4%22.9%7.1%26.1%-
Dcb Bank ($DCBBANK)-26.2%22.5%25.3%20.8%
Syndicate Bank ($SYNDIBANK)32.2%11.9%7.9%20.2%-
Yes Bank ($YESBANK)-33.7%21.6%17.7%18.9%
Axis Bank ($AXISBANK)-24.5%13.1%15.6%14.9%
 
Median (28 companies)30.3%16.7%11.2%10.8%5.9%
Punjab & Sind Bank ($PSB)-12.2%8.6%7.5%1.8%


Top companies by CAPEX/Revenue, %

Top 5 FY2012 FY2013 FY2014 FY2015 FY2016
Bank Of India ($BANKINDIA)2.0%1.1%1.5%3.6%-
State Bank Of Mysore ($MYSOREBANK)1.6%1.3%-3.5%1.4%
Jammu & Kashmir Bank ($J&KBANK)1.4%1.3%2.2%3.3%-
Lakshmi Vilas Bank ($LAKSHVILAS)2.1%1.4%1.6%2.4%2.4%
Dcb Bank ($DCBBANK)9.0%7.0%1.6%1.9%2.2%
 
Median (28 companies)1.2%1.2%1.3%1.3%1.4%
Punjab & Sind Bank ($PSB)-1.1%0.7%0.9%0.4%


Top companies by ROIC, %

Top 5 FY2012 FY2013 FY2014 FY2015 FY2016
Karnataka Bank ($KTKBANK)6.8%10.2%7.7%10.4%-
Axis Bank ($AXISBANK)9.6%8.9%9.1%8.8%7.6%
Yes Bank ($YESBANK)9.8%8.4%8.4%8.7%9.0%
Kotak Mahindra Bank ($KOTAKBANK)6.8%6.5%7.1%8.5%-
Lakshmi Vilas Bank ($LAKSHVILAS)6.5%7.5%0.7%6.1%5.8%
 
Median (28 companies)7.6%6.5%3.4%4.5%4.7%
Punjab & Sind Bank ($PSB)-4.7%3.1%1.3%3.4%


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