BoB Share Price Rose Over 4% After Release of Q2 FY25 Results

Bank of Baroda (BoB) reported a net profit of ₹5,238 crore for Q2 FY25, marking a 23.2% increase from ₹4,253 crore in the same quarter last year. The bank’s net interest income rose by 7.3% to ₹11,622 crore, up from ₹10,831 crore in Q2 FY24.

For the first half of FY25, net interest income increased to ₹23,222 crore, reflecting a year-on-year growth of 6.4% from ₹21,827 crore. 

Non-interest income surged 24.2% to ₹5,181 crore in Q2 FY25, compared to ₹4,171 crore a year earlier. This contributed to an operating profit of ₹9,477 crore, an 18.2% rise from ₹8,020 crore in Q2 FY24.

BoB’s Asset Quality

The bank’s asset quality showed improvement, with the Gross Non-Performing Assets (GNPA) ratio decreasing to 2.50% from 3.32% in Q2 FY24. The Net Non-Performing Assets (NNPA) ratio also improved, dropping to 0.60% from 0.76% in the previous year. Additionally, the capital adequacy ratio strengthened to 16.26%, up from 15.30% a year ago.

On the deposit front, domestic deposits increased by 7.1% to ₹11,50,791 crore, while international deposits rose by 21.2% to ₹2,12,695 crore. Total global deposits reached ₹13,63,486 crore, a 9.1% increase from ₹12,49,647 crore a year prior.

In terms of advances, retail advances grew by 19.9% to ₹2,32,311 crore. Domestic gross advances increased by 12.5% to ₹9,38,883 crore, while international advances rose by 7.6% to ₹2,04,156 crore. Overall, global advances climbed to ₹11,43,039 crore, reflecting an 11.6% growth.

In a separate initiative, the bank successfully raised ₹5,000 crore through a 10-year infrastructure bond issuance in September, marking its second issuance within a fortnight following a similar ₹5,000 crore sale on August 26.

Commenting on the results, Debdatta Chand, MD & CEO of Bank of Baroda, stated, “This has been a strong quarter in terms of both top-line and bottom-line performance.” He highlighted that the bank’s Special Mention Account (SMA) book represented 0.47% of advances in Q2, reflecting solid asset quality. Chand noted that the competitive deposit market has driven the bank to innovate its product offerings for growth, adding, “We are also striving to stay ahead in the digital space and are investing significantly in IT capital expenditures.”

Looking ahead, he projects deposit growth for FY25 to be in the range of 9-11%, a slight decrease from the previous estimate of 10-11%. The bank aims to maintain its margin guidance at 3.15% ± 5 basis points for FY25, with a slippage ratio expected between 1-1.25%. Additionally, Chand indicated that the bank anticipates keeping credit costs below 0.75% for FY25, with retail advances expected to grow by around 20%.

On October 28, 2024, Bank of Baroda’s share price opened at ₹241.15 and touched the day high of ₹253.55 at 11:50 AM, reflecting a rise of ~4.97% from the previous close.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.