Dhanlaxmi Bank hits back-to-back upper circuit; Stock hits 2017-year high level

Dhanlaxmi Bank Ltd is an Indian banking institution that offers an extensive array of financial services. These services encompass retail banking, corporate banking, and treasury operations, with a primary focus on the Southern states of India. The bank was incorporated in 1927 in Thrissur, Kerala. There was significant strength in the bank’s stock today.  

During Friday’s trading session, the bank’s stocks surged to Rs 36.30 per share, reflecting a remarkable gain of approximately 20%. Notably, it reached the upper price limit of 20%, remaining locked in during the session. Continuing this trend, it once again hit the upper circuit of 20% in today’s trading session, ultimately closing at Rs 43.55 per share, marking a 20% increase from Friday’s session. 

When evaluating the stock’s performance over the past year, it demonstrated an impressive multibagger return of around 120%. The current market capitalisation of the bank stands at Rs 1,102 crore. 

Additionally, the stock is currently trading close to its highest-recorded price in 2017. The peak price throughout that year was Rs 44.95 per share, and it was also trading at a similar level in 2015. As of today, the closing price stands at Rs 43.55 per share, just below the peak. 

Stock’s Trading and Delivery Volume:

Financial Performance: 

In the second quarter of FY24, the bank reported a notable increase in interest earned, reaching Rs 304 crore, reflecting a robust 15.8% year-on-year growth compared to Rs 262.50 crore in the corresponding quarter of the previous year. The total income for the period amounted to Rs 327.43 crore, a substantial 14.8% year-on-year increase from Rs 285.26 crore. 

Analysing the bottom line of the financial statements, the bank achieved a net profit of Rs 23.16 crore, marking a significant 46% uptick compared to the Rs 15.89 crore reported in the same quarter last year. 

Examining the net non-performing assets (NNPAs) and gross NPAs (GNPAs), both stood at 1.29% and 5.36%, respectively, showcasing a slight year-on-year improvement from 6.04% and 2.23%, respectively. 

In terms of deposits, the bank witnessed growth, with deposits rising from Rs 12,747 crore to Rs 13,817 crore. On the other hand, the bank’s advances surged from Rs 8,762 crore to Rs 9,885 crore. 

Business Overview: 

Dhanlaxmi Bank Limited is an India-based bank engaged in providing a range of banking and financial services. The company’s segments include Treasury Operations, Corporate/Wholesale Banking, Retail Banking, and Other Banking Business Operations. The company provides personal banking, corporate banking, non-resident Indian (NRI) banking, micro and agri-banking, small and medium enterprise (SME) banking, and forex and trade finance services. Its personal banking services include accounts, loans, gift cards, credit cards, debit cards, depository services, forex services, online trading, mobile banking, commercial vehicle loans, and others. 

Its micro and agri-banking services include Kissan Vahana, Kissan Credit Card, Agri Gold Loan, Kissan Credit Card, Micro Credit – microfinance institutions (MFI), and Micro Credit – self-help groups (SHGs). Its NRI banking services include money transfers, home loans, lease rental discounting, and others.