PNB Q4 results preview: Standalone profit to likely zoom 2.6x, NIM to remain stable

Punjab National Bank (PNB)-India’s eight largest public sector lender in terms of market capitalisation- is scheduled to report its January-March quarter earnings on May 9, 2024 (Thursday). Zee Business research desk estimates the Delhi-based bank’s standalone Q4FY24 profit to increase 2.6 times to Rs 3,000 crore on the back of improvement in the lender’s corporate and wholesale book. PNB’s profit in the corresponding period a year-ago stood at Rs 1,158.6 crore.

Net interest income (NII), a difference between the income a bank realizes from its lending activities and the interest it pays to depositors, is also expected to log 6.3 per cent increase on year during the review period to Rs 10,100 crore. In Q4FY23, the bank’s NII was reported at Rs  9498.8 crore.

The bank's net interest margin (NIM) – a key measure of profitability for financial institutions — is expected to remain steady on a sequential basis. In the previous quarter, the lender’s domestic NIM came in at 3.3 per cent, while global was at 3.15 per cent.

The bank’s asset quality is projected to log an improvement with gross NPAs or non-performing assets expected in the range of 5.8-6 per cent from 6.24 per cent in the previous December-ended quarter.

Net NPAs, meanwhile, are expected in the range of 0.8-0.9 per cent, in comparison to 0.96 per cent  a quarter ago.

Analysts expect the lender’s fee income to increase by 15-16 per cent during the reporting quarter. Also, there is seen an increase in treasury income at the bank.

PNB Q4 business update

The lender in its Q4 business update said that during the period it recorded a 7 per cent on year increase in its total deposits to Rs 13.7 lakh crore as against Rs 12.82 crore in the corresponding period of the previous year. The sequential grown in total deposits, however was at 3.5 per cent.

Total business at PNB recorded an 8.8 per cent surgeon year to Rs 23.56 lakh crore.

PNB share price performance

Over the past year, shares of PNB rewarded investors with 137 per cent return outperforming Nifty PSU Bank that gained 74 per cent during the same timeframe. Ahead of its earnings tomorrow, shares of the lender traded with gains of over 1 per cent at Rs 123.7 per share on the BSE.