Cart

%

Buy more than one course to get upto Flat 10 % discount.

CSB Bank

img

ABOUT

CSB Bank is one of the oldest Indian bank with a history of 98 years. It has a strong hold in Kerala while a significantly in the southern part of India namely Tamil Nadu, Karnataka, and Maharashtra.

CSB bank has a customer base of around 1.3 Million on September 30, 2019. Bank’s operation is mainly focused into SMI, Retail and NRI customers. Products and services are delivered through multiple channels, including 412 branches (excluding three service branches and three asset recovery branches) and 290 ATMs spread across 16 states and four union territories as on September 30, 2019.

Overall deposits were ₹ 155,098 million for the six month period ended September 30, 2019. CASA deposits was ₹ 43,719 million as on September 30, 2019 and CASA ratio was 28.19% for the six month period ended September 30, 2019, leading to a reduction in cost of deposits to 5.91% for the six month period ended September 30, 2019. 

Advances (net) increased from ₹ 80,008 million in Fiscal 2017 to ₹ 106,152 million in Fiscal 2019. Advances were ₹ 112,978 million for the six month period ended September 30, 2019. Yield on advances decreased from 11.10% as on March 31, 2017 to 9.85% as on March 31, 2019. Further, yield on advances was 10.22% as on September 30, 2019.  

Gross NPAs decreased to 4.87% as of March 31, 2019 from 7.25% as of March 31, 2017. Further, our gross NPAs was 2.86% as on September 30, 2019. The net NPAs decreased to 2.27% as of March 31, 2019 from 4.12% as of March 31, 2017. Further, net NPAs was 1.96% as on September 30, 2019.

BUSINESS STRATEGIES

Transformational acceleration to emerge out with modernisation

CSB Bank seems to modernise with the time, from the decentralisation to rebranding through changing the name, from focusing on partnership driven model to enhancing customer experience and expanding the products, services and customer interface as a full service bank.

Technological development for improving operational efficiency, scalability and customer experience

It is currently working on a digital strategy to focus on acquiring customers, enhancing our customer experience, and making our internal business operations more efficient. The technology team is fragmented into two sections as members who will look after the day-to-day functioning, and members who will aid in transformation of the Bank.

Concentrating on recovery of NPA and improving the asset quality

Bank’s gross NPAs decreased to 4.87% as of March 31, 2019 from 7.25% as of March 31, 2017. It intend to set up dedicated teams for retail, SME, and corporate segments dedicated towards recovery of provisioned portfolio and also managing and monitoring of ongoing stressed portfolios.

Cultivating the SME, Agriculture and retail customers by benefiting from the strong capital position

Focusing on marketing for further penetration in the SME sector and infuse some capital into it for further expansion. A dedicated vertical is set up just for agriculture based business to provide related products. For retail customers it is developing its loan portfolio, mainly focus on gold loans, two wheeler loans, loans against property, and personal loans.

Continue to leverage strong deposits franchise

To improve wholesale deposits intend to grasp relationships with various institutions like educational institutions, temple trusts, and churches and corporate & SME relationships by cross selling salary accounts for their employees. For individual deposits, it aim to offer products and services based on customer segmentation.For the NRI deposits which is already a major upside, it plans to setup a dedicated team for managing the operations related to NRI customers from different branches, improving the deposits further.

COMPETETIVE STRENGTHS

Strong channel network and trusted brand in South India

Operating in 16 States and four Union Territories in India, reaching 1.3 million customers through 412 branches (excluding three service branches and three asset recovery branches) and 290 ATMs, as on September 30, 2019.

Strong capital base for growth

Pursuant to a preferential allotment of Equity Shares and warrants to FIHM, for which it received ₹ 7,207.53 million in Fiscal 2019 and the balance amount of ₹ 4,869.29 million in Fiscal 2020.

Well established SME business

As a percentage of total advances, loans to SME customers accounted for 43%, 37%, 32% and 29.47% as on March 31, 2017, March 31, 2018, March 31, 2019 and September 30, 2019, respectively. As on March 31, 2019 and September 30, 2019, our advances to SME customers aggregated to ₹ 34,733 million and ₹ 33,605 million, respectively, spread across 7,529 accounts and 7,534 accounts,

Retail offering driven by strong gold loan portfolio

Gold loans contributing 24%, 26%, 31% and 33.17% of total advances as on March 31, 2017, March 31, 2018, March 31, 2019, and September 30, 2019, respectively. As on March 31, 2019 and September 30, 2019, it had 522,248 and 595,121 gold loan accounts, with advances aggregating to ₹ 33,331 million and ₹ 37,818 million.

Stable and granular deposit base

overall deposits base has remained intact and has increased from ₹ 149,116 million in Fiscal 2017 to ₹ 151,239 million in Fiscal 2019. CASA deposits increased from ₹ 36,946 million as on March 31, 2017 to ₹ 42,106 million as on March 31, 2019.

INITIAL PUBLIC OFFERING

BID/OFFER OPENS ON Nov 22,2019
ISSUE TYPE Book Built Issue
BID/OFFER CLOSES ON Nov 26,2019
ISSUE SIZE

21,021,821 Eq Shares aggregating upto Rs 405.7Cr - Rs 410Cr

FRESH ISSUE 1,243,523 Eq Shares aggregating upto Rs 24 Cr
OFFER FOR SALE 19,778,298 Eq Shares aggregating upto Rs 385.6 Cr
ISSUE PRICE Rs193-Rs195
FACE VALUE Rs 10 per Eq. shares
MARKET LOT 75
LISTING AT BSE,NSE

SHAREHOLDING PATTERN

Set forth below is a list of Shareholders holding 1% or more of the paid-up share capital of our Bank

Name of the Shareholder No. of Equity
Shares
Percentage of
the pre-Offer
Equity Share
capital (%)
FIH Mauritius Investments Ltd 86,262,976 50.087
LIIPL CSB OFS Escrow Demat Account 19,778,298 11.484
CSB ESOS Trust 5,000,000 2.903
Mr. Yusuffali Musaliam Veettil Abdul Kader 3,581,722 2.080
Volrado Venture Partners Fund II 3,273,286 1.901
Mr. Vallabh Bhanshali 2,185,392 1.269
Mr. Satpal Khattar 1,773,906 1.030
Mr. Lal Arakulath Sankappa 1,756,908 1.020
Mr. Zafar Ahmadullah 1,750,000 1.016

INDUSTRY ANALYSIS

Trend in Deposits for Public Sector & Private Sector Banks

Trend in Advances for Public Sector & Private Sector Banks

Facts on Financial Outreach in India

Population group wise number of scheduled Commercial Banks Branches

Deposit Growth Trends

The following graph illustrates the growth in deposits from the period of 2013-14 to 2018-19

Bank Credit Growth Trends

The following graph illustrates the growth in deposits from the period of 2013-14 to 2018-19

Gold Loan Market in India

Micro, Small & Medium Finance Segment

As per the National Sample Survey (NSS) 73rd round, conducted by National Sample Survey Office, Ministry of Statistics & Programme Implementation during the period 2015-16, there were 633.88 lakh unincorporated nonagriculture MSMEs in the country engaged in different economic activities. It is seen that 31% MSMEs were found to be engaged in Manufacturing activities, while 36% were in Trade and 33% in Other Services. Again out of 633.88 estimated number of MSMEs, 324.88 lakh MSMEs (51.25%) were in rural area and 309 lakh MSMEs (48.75%) were in the urban areas.

Steady Increase in MSME Finance

MSME sector has a significance contribution in the growth of Indian Economy. This sector basically rely nonbank finance for the operations and flexibility in credit flow in the sector. There has been a considerable rise in the credit extended to this particular sector.

Financial Overview Of CSB Bank

(Values In Rs million)

Year

Total Income

Total Expenditure

Net Profit After Tax

Total Assets

31 March 2017

16,174.96

14657.83

-579.91

157700.26

31 March 2018

14222.26

13,478.99

-1,270.88

153346.62

31 March 2019

14834.33

14,700.75

-656.89

164534.60

30 Sept 2019

8,167.14

7131.39

442.72

173232.58

Total Income

Total Expenditure

Net Profit After Tax

Total Assets

STASTICAL OVERVIEW

Year

Basic EPS(Rs)

RoNW(%)

Net Asset Value(Rs)

31 March 2017

-7.66

-10.62

67.46

31 March 2018

-15.70

-34.94

43.68

31 March 2019

-7.90

-6.74

67.46

Basic EPS(Rs)

RoNW(%)

Net Asset Value(Rs)

COMPARISION WITH PEERS

 

Total Income(Rs Million)

Basic EPS(Rs)

P/E

P/BV

RoNW(%)

NAV (Rs)

CSB Bank

14,834.33

-7.9

-

-

-6.74

73.54

DCB Bank

33,917

10.5

19.4

2.2

11.3

92.7

Federal Bank

1,29,707

6.7

14.5

1.4

9.8

68

South India Bank

76,027

1.4

12.1

0.6

4.9

28.2

City Union

42,816

9.6

21.3

3.1

14.1

65.9

Karur Vysya Bank

67,786

2.6

27.1

0.9

3.3

80.4

Total Income(Rs Million)

Basic EPS(Rs)

P/E

P/BV

RoNW(%)

NAV (Rs)

References

  • CSB BankLtd Red Herring Prospectus.
  • www.csb.co.in

Learn how to read IPO report

Check Now