Central Bank of India Company Analysis

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Company Profile  :  Government owned bank based in Mumbai. One of the oldest bank set up in 1911. Today it is among top 5 PSU banks. The bank also leader in Education loan and home loan.

As a bank it offers Wholesale and retail banking to its customers. The bank is playing key role in sector of agriculture, Small and medium enterprise and it also introduced self employment scheme. The bank also giving services to many major corporate clients like ICICI, IDBI, UTI, LIC, HDFC and other major corporate.

Share Holding Pattern i

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Financials and Ratio

 2010-112011-122012-132013-142014-152015-16
Loan Book 129725.41147512.85171935.84177315.17188477.53180009.59
ROE 23.625.968.5803.870
ROA 0.590.230.37(0.43)0.19(0.46)
EPS 22.045.6511.24(11.10)4.27(8.55)
Book Value 131.20121.42113.2491.3194.3385.14
Efficiency 32.3729.3527.1536.7330.1536.37
Net NPA to Loan Book 133447
Tier 1 Capital 688888
Dividend per Share 2.522.500.50
CASA 35.1733.2732.5533.3334.0535.48

Future Prospects  : NPA issue is very bad for many Public sector and private sector banks. It is affecting Central Bank of India also. Though The bank enjoys one of the largest Branch network and top in total income. But as bank is not holding any stake in MF or Insurance Company, it is affecting it as it will help them to monetize the branch network.

NPA is such a bad that even after provision, it is above 5% of total Loan Book, affecting Capital adequacy. Worst is it is totally dependent on Govt. Low ROE and ROA making things worse. Not so attractive CASA but growing. But still market giving it the PBV 1. Reason is branch network. 4728 branches as on 31 March 2016 out of which 2/3 is among Rural and Semi Urban areas. Bank is also leader among Education loan and Housing loan.

Hereafter it is looking sorted out situation as Textile, metal, infrastructure as big NPA and it is sufficient down. Looking good Buy.

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About Ashutosh Tilak

Tracking Indian Capital Market since 2010. Finance Student, On this blog I am writing about finance and Investing. You can contact me analystashu@gmail.com or @androidashu & @InsideFinanc on twitter