CSB Bank Q4 Review - Closes Year With Somewhat Slower Growth But Long-Term Thesis Intact: Yes Securities

Yes Securities Report

CSB Bank's corporate book has de-grown YoY. The direct assignment book has also de-grown since the yield of this business was not satisfactory. The LC/BD book has also been held back due to interest rate considerations. On the other hand, the gold loan portfolio has grown 22% YoY.

The small and medium enterprise and retail loan book have also grown better. The bank is building a strong wholesale banking business and hence, there will be a strong turnaround in the wholesale business.

If the banking system grows at 13-14%, the bank could grow at 19-20% and gold loans slightly slower between 15-20%.

We maintain ‘Buy’ rating on CSB with a unchanged price target of Rs 475: We value the bank at 1.6 times FY26 price/book value for an FY25E/26E return on equity profile of 14.9%/15.2%.

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