Jainee’s Coffee Can Portfolio on 26 January 2026 (New Call every Week)
Indian Bank – Coffee Can Snapshot
Indian Bank is a medium-sized public sector bank started in 1907. It offers deposits, loans and allied banking services. The bank operates through Treasury, Corporate/Wholesale Banking, Retail Banking and Other Banking Operations.
Key Points
Market Position
Indian Bank is among the larger PSBs and is stated to be the seventh-largest public sector bank in terms of deposits and advances (post amalgamations).
Revenue Mix (Q1 FY25)
| Segment | Share |
|---|---|
| Retail Banking | ~39% |
| Corporate Banking | ~35% |
| Treasury | 24% |
| Others | 2% |
Key Ratios (Trend Snapshot)
| Parameter | Q1 FY25 | FY22 | Interpretation |
|---|---|---|---|
| CRAR | ~16.5% | 16.53% | Capital position steady and comfortable |
| Domestic NIM | 3.5% | 2.9% | Margin expansion supports profitability |
| Gross NPA | 3.77% | 8.47% | Strong asset quality improvement |
| Net NPA | 0.39% | 2.27% | Net stress now very low |
| PCR | 96.66% | 87.38% | High provisioning cushion |
| Slippage Ratio | 1.5% | 2.78% | Lower incremental stress / better underwriting |
Branch Network
| Parameter | Data |
|---|---|
| Domestic Branches | ~5,800 |
| ATMs | ~5,000 |
| Business Correspondents | ~11,900 |
Coffee Can Matrix – Indian Bank
| Parameter | Data / Interpretation |
|---|---|
| CMP (Rs.) | 876.45 |
| P/E Ratio | 9.82 → Low valuation for a PSU bank; indicates value pricing despite improved fundamentals |
| Quarterly Net Profit (Rs. Cr.) | 3,147.50 |
| Quarterly Profit Growth (%) | 8.15% → Steady earnings growth; not explosive, but improving |
| Quarterly Sales (Rs. Cr.) | 17,102.21 |
| Quarterly Sales Growth (%) | 8.45% → Moderate topline growth; consistent momentum |
| Sales CAGR (5 Years) | 23.72% → Strong multi-year growth trend |
| Profit CAGR (5 Years) | 67.24% → Very strong profit compounding; reflects credit-cost normalization and improved efficiency |
| ROCE (%) | 6.38% → Typical for banks; use along with NIM/ROA style metrics (NIM improving is a plus) |
| All-Time High (Rs.) | 908.60 |
| RSI | 60.36 → Positive momentum; not overbought |
| 1-Week Return (%) | 2.86% → Mild short-term upmove |
| MACD | 14.38 |
| MACD (Previous) | 13.23 → MACD rising; trend strength improving |
| Volume Trend | Volumes higher than 1-month average (1D: 33.89L vs 1M: 24.99L) → participation improving |
Coffee Can Verdict – Indian Bank
👍 Positives (Coffee Can Strengths)
✔ Asset quality turnaround is visible: Gross NPA down sharply and Net NPA near 0.39%
✔ High provisioning comfort: PCR ~96.66% offers strong cushion against future stress
✔ Profit compounding is strong over 5 years (Profit CAGR ~67%) suggesting structural improvement in earnings power
✔ Improving profitability levers: Domestic NIM expanded to ~3.5% vs ~2.9% earlier
✔ Attractive valuation (P/E ~9.8) gives margin of safety if execution sustains
⚠️ Considerations (Coffee Can Risks)
✖ PSU banking remains policy and cycle sensitive; credit costs can rise in downturns
✖ Banks typically show lower ROCE by nature; long-term quality depends more on NIM + asset quality discipline
✖ Short-term upside may face supply near all-time high zone (Rs. 908.60)
✖ Currency / macro volatility can impact market sentiment toward financials even when fundamentals are stable
Chanakya’s Coffee Can Conclusion
Indian Bank fits the Coffee Can framework on “improving quality + reasonable valuation” parameters. The standout is the multi-year shift in asset quality (sharp NPA reduction) and provisioning strength (PCR near 97%), which together improve sustainability of profits. With NIM expansion supporting earnings and P/E still below 10, the stock offers a value-backed compounding setup.
For Coffee Can investors, the approach is disciplined accumulation rather than chasing spikes—prefer adding on market dips while tracking asset quality (slippages), margin stability (NIM), and credit costs each quarter.
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