Bank of Baroda Q4 results preview: Net profit likely to more than double to Rs 4,070 crore as asset quality improves

Bank of Baroda Q4 results preview: Bank of Baroda (BANKBARODA) is all set to report its financial results for the January-March period on Tuesday, May 16. Analysts expect the lender — India's second largest state-run bank by market capitalisation — to clock an overall strong performance backed by improvement in asset quality with a reduction in new bad loans. 

According to Zee Business research, Bank of Baroda is likely to report a standalone net profit of Rs 4,070 crore for the quarter ended March 2023, which translates to growth of 128.8 per cent compared with the corresponding period a year ago. 

The analysts estimate growth in the PSU bank's net interest income (NII) — or the difference between interest earned and interest paid — at 33.2 per cent on a year-on-year basis to Rs 11,470 crore.

According to the research, Bank of Baroda's net interest margin (NIM) — a key measure of profitability for a financial institution — is estimated to remain steady. For the quarter ended March 2022, the PSU lender's NIM had stood at 3.08 per cent.

The lender is likely to report improvement in asset quality, measured as a percentage of bad loans in total loans. 

Gross non-performing assets (NPAs) — or gross bad loans — are estimated to ease to 4-4.2 per cent for the March quarter from 4.5 per cent for the previous three months. On a net basis, the NPAs are pegged at 0.9 per cent as against 0.99 per cent for the quarter ended December 2022. 

The Zee Business analysts expect Bank of Baroda's slippages to decrease sequentially. Slippages are newly-added non-performing assets.  

Bank of Baroda shares: Historical performance

Bank of Baroda shares (BANKBARODA) lost 9.1 per cent of their value in the March quarter, a period in which the headline Nifty index fell 4.1 per cent. 

The stock finished 2022 with a return of 126.5 per cent as state-run lenders outshone their private peers, sharply outperforming a five per cent rise in the index. 

Bank of Baroda dividend history

The state-run lender has paid two dividends to its investors in the past six years. 

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