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00:00All right, it's results season and as we wind down towards the end of the quarterly numbers,

00:05one important set of numbers to look at is Punjab National Bank.

00:09Now the PSU player has been a darling of the markets for most of this year and has put

00:17out a fairly decent set of numbers.

00:20Atul Kumar Goyal is joining us.

00:22He's the MD and CEO.

00:23Mr. Goyal, thank you for speaking with us here at NDTV Profit.

00:28Let's just first begin by understanding the numbers.

00:31Now the PAT looks very robust, up about 160%.

00:36Your operating profits have also moved up 9% year-on-year, 1% Q-on-Q, net interest income

00:42is also up.

00:44But credit growth while growing at about 12% is slightly below target.

00:53What would be your take on the overall numbers and on credit growth?

00:57Very good morning, Tamanna ji.

01:00As far as profitability is concerned, definitely there is an increase of more than 160% in

01:06the profit.

01:07The profit increases on account of the so many factors, but major factor is the contribution

01:14of the reduction in the credit cost.

01:16Credit cost for the last quarter has reduced to 0.80% and the credit cost for all over

01:22the year was 1.40%.

01:25Since we have already improved our PCR to the 95%, so we are giving the guidance for

01:31the next year, it will be below 1%, so profitability is bound to increase every quarter by quarter

01:36in the times to come.

01:37Your specific question regarding the credit growth, definitely it is little less whatever

01:42the guidance we have given 12% to 13%, it was 11.4%.

01:47If you see the credit growth in the June quarter, September quarter and the December

01:52quarter, it was more than 13%, but why it has reduced on account of, because if you

01:57see the last quarter of the last financial year, March 23 quarter, there was some bulk

02:02business we have done, so this was the reason and we are giving the guidance for the next

02:06financial year, the credit growth will remain within the range of the 11% to 12%.

02:11And so 11% to 12% is your outlook for credit growth next financial year.

02:16What about deposit growth?

02:17Even that was slightly under the estimates that were given.

02:22Deposit growth, we are giving the target around 9% to 10% for the current financial year 2024-25.

02:30The reason was less of the deposit growth, if you see my CDO ratio is around 71%, so

02:39there was no need for taking the bulk deposit, so we have resorted ourselves not to take

02:43any bulk deposit even as on date.

02:45We are having the excess SLR, more than 1 lakh crore available to us, so this was the

02:51reason, otherwise if you see the CASA, CASA was 41.40% and last year we have opened more

02:57than 1 crore CVMA account and 2.68 lakh current account where money will flow, so on account

03:03of this we are targeting our CASA ratio should be around 42% in the current financial year.

03:10I just want to come to the point of recoveries, recoveries have been robust, NPAs have also

03:18been coming down, but what is your outlook to the pace of recovery, sir?

03:23The pace of recovery will remain very good in the current financial year also because

03:29we are having around 90,000 crore rupees TW book and around 55 crore rupees of the gross

03:35NPA book.

03:36If you see the last year, our recovery was 3 times of the addition also, so 5.73 we have

03:43achieved for the gross NPA number and the guidance for the current financial year is

03:47less than 5%, similarly the net NPA has been achieved to the range of 0.73%, the target

03:56of the net NPA is less than 50% in the financial year 2024 and since our PCR is improved to

04:05the 95%, so credit cost as I told earlier also we are giving the guidance less than

04:101%.

04:11Okay, Goyalji let me come to I would say the biggest topic right now for the banking space

04:18and for you as well which is the RBI draft guidelines on project financing.

04:23Now you have said publicly there is no need to panic, but there is a need for discipline

04:28in the space.

04:29Now before I come to you and ask you, you know why you have said that, what do you mean,

04:33I want to understand what is the share of project financing, how much of this category

04:39is on the balance sheet right now?

04:43My reply to this is the first is a draft guidelines, we should wait for the final guidelines also

04:50because this guidelines has been issued by the regulator on the 3rd of the May, it is

04:54a like a consultative approach and they have asked the comment from each and every stakeholder

05:01whether it will be a bank and it will be a promoter side also or the corporate side

05:06also.

05:07So let us wait for the final guidelines and one thing I can assure all of you that what

05:12will be the final guidelines, there should not be any worry for the Punjab Raja Bank

05:16because today our balance sheet is very strong, but some clarification is also required because

05:22you are asking what will be the, which type of the loan book you are having because as

05:27per the draft guidelines, it is applicable to all type of the project financing, the

05:32infra as well as the non-infra without any limit also, so we will take the clarification

05:37whether there is a need of fix any limit etc also, so I think there should not be a matter

05:43of worry about what will be the final guidelines, we should wait for them, we will be in a position

05:47to provide that.

05:48Now, so what I want to understand is as of today, as per the definitions in the guidelines

05:55and I understand completely well these are not final, so with that caveat, as of today

06:00how much of your loan mix will come under these categories sir of project financing

06:05which would be subjected to higher provisions if these draft guidelines go through, so I

06:11have put all the ifs and buts, but having said that how much of the loan book right

06:16now would be vulnerable to this?

06:19That will not be a too much of the impact because sometime of the loan in the loan book

06:26the infra, where we have given the corporate loan that will be the out of the, this part

06:31although it is coming under the category of the infra, similarly I would like to tell

06:35you also some of the discounting of the annuity from the NHI, although it will come in the

06:40book of the, book of the infra, but that will not come under the guidelines, so in my opinion

06:48rough estimate is like that, whatever our infra book is there, only 50% of debt will

06:54be come under this category.

PNB's Growth Outlook For FY25 | NDTV Profit

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