Any current/future new fundraising through debt or equity?

Canara Bank is planning fundraising actions involving subsidiaries: - Two subsidiaries are preparing for public issues (IPOs) as part of ongoing actions. - Credit card business is being shifted to a subsidiary, with a General Manager appointed recently to lead initiatives. No explicit mention of new debt or equity fundraising at the parent bank level within the provided transcript. The bank's capital expenditure is ongoing with a target of ₹1,000-1,200 crores annually, mostly operational rather than fundraising. No direct indications of fresh large-scale capital or debt raise for the bank

Any current/future capex/capital investment/strategic investment?

Annual capital expenditure target is around ₹1,000 to ₹1,200 crores. For the current year, approximately 80% of the planned capital expenditure transactions have been completed, with payments to be staggered. Purchases and procurements have been conducted through the GEM portal. Continuous heavy investment in capital expenditure over the last three years has led to an increase in annual maintenance charges and operating expenses. Investments in digital technology and infrastructure continue to be a priority to support subsidiaries and improve internal controls. Specific strategic investments i

Current/ Expected Orderbook/ Pending Orders?

The bank targets a capital expenditure of around ₹1,000 to ₹1,200 crores annually. For the current year, approximately 80% of the transactions have been completed. Payments for these orders may happen in a staggered manner. Purchase orders have been issued through the GEM portal. Continuous investment in capital expenditure over the past three years is ongoing. This spending includes digital and technology initiatives to support subsidiaries and core banking functions.

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Canara BankQ3 FY23Banks

Canara Bank Q3 FY23 Earnings Call Analysis

Revenue, margin, capex, fundraise and order book outlook from management commentary.

Price: ₹130P/E: 5.9Market Cap: ₹1.2L CrSector: Banks

Management growth scorecard

Revenue

Category 3

Margin

Category 3

Fundraise

N/A

Order

N/A

Capex

Yes

1 of 3 growth signals are positive — mixed outlook.

Full analysis

Revenue guidance

Category 3

- Canara Bank expects steady growth in advances, with guidance of around 10.5%, potentially reaching about 12% growth. - Total business growth guidance is around 10%, with the bank already exceeding this target. - The bank is optimistic about improved business in the second half of the year compared to the second quarter. - Growth in core agricultural loans is gaining traction, aided by self-help group lending and rural infrastructure financing. - Digital banking initiatives and co-lending partnerships are expected to contribute positively to growth. - Retail term deposits are growing consistently at more than 3% quarter-on-quarter. - CASA growth is targeted to maintain existing levels with a focus on gradual improvement. - Capital expenditure of around ₹1,000 to ₹1,200 crore annually supports continued modernization and operational efficiency. Overall, Canara Bank projects a stable and slightly conservative growth path in sales, revenue, and volumes for FY25 and FY26.

Margin guidance

Category 3

- **Advances Growth**: Guidance to grow advances by about 12% in FY25 and FY26, with overall business growth above 10%. - **Operating Profit**: Current operating profit grew 10.3% YoY; expected steady growth driven by advances and RBI interest. - **Net Profit & EPS**: FY24 net profit showed a robust 42.81% YoY growth; positive outlook expected to sustain, supported by low slippages and improved asset quality. - **Margins**: Net interest margin maintained just above 3% (3.02%); margin pressure due to higher deposit costs expected to ease if liquidity improves. - **Cost Control**: Cost-income ratio maintained below 45%, expected to remain controlled with branch rationalization and operating expense management. - **Provisioning**: Adequate provisioning maintained, which supports stable profit outlook without surprises. - **Subsidiaries**: Positive progress in subsidiaries (Can Fin Homes, credit card business) expected to contribute to profits in coming years. - **Digital and Treasury Operations**: Investments in digital initiatives and steady treasury income also support earnings growth. Overall, earnings and operating profits are expected to grow steadily with a conservative but outperforming approach.

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Fundraise plans

→Canara Bank is planning fundraising actions involving subsidiaries:
→ - Two subsidiaries are preparing for public issues (IPOs) as part of ongoing actions.
→ - Credit card business is being shifted to a subsidiary, with a General Manager appointed recently to lead initiatives.
→No explicit mention of new debt or equity fundraising at the parent bank level within the provided transcript.
→The bank's capital expenditure is ongoing with a target of ₹1,000-1,200 crores annually, mostly operational rather than fundraising.
→No direct indications of fresh large-scale capital or debt raise for the bank itself were shared in the discussed sections.

Order book

→The bank targets a capital expenditure of around ₹1,000 to ₹1,200 crores annually.
→For the current year, approximately 80% of the transactions have been completed.
→Payments for these orders may happen in a staggered manner.
→Purchase orders have been issued through the GEM portal.
→Continuous investment in capital expenditure over the past three years is ongoing.
→This spending includes digital and technology initiatives to support subsidiaries and core banking functions.

Capex plans

Yes

→Annual capital expenditure target is around ₹1,000 to ₹1,200 crores.
→For the current year, approximately 80% of the planned capital expenditure transactions have been completed, with payments to be staggered.
→Purchases and procurements have been conducted through the GEM portal.
→Continuous heavy investment in capital expenditure over the last three years has led to an increase in annual maintenance charges and operating expenses.
→Investments in digital technology and infrastructure continue to be a priority to support subsidiaries and improve internal controls.
→Specific strategic investments include the opening of an International Banking Unit (IBU) in GIFT City, expected to be fully operational soon.
→Subsidiary-focused initiatives include potential IPOs and shifting credit card business to a subsidiary, supported by technological upgrades and leadership strengthening.
→The bank plans to rationalize branches and open around 275 new branches targeting CASA growth.

How does Canara Bank rank vs peers in Banks?

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1Canara Bank

Rev 3Mar 3

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