Company Introduction
Headquarters Location: Mangaluru, India
Core Business Summary: Karnataka Bank Ltd is a private sector bank providing a range of banking and financial services to individuals, businesses, and institutions.
Overview
₹ 175
5.67
31
₹ 6,586 Cr
Company Overview
Industry Sector: Banking and Financial Services
Industry Trends
Industry Growth Next 5 Years: 10-12% CAGR
Key Demand Drivers: Increasing demand for digital banking, growing middle-class population, and government initiatives to promote financial inclusion
Last 5 Year Cagr Industry Growth: 13.1%
Major Competitors: HDFC Bank, ICICI Bank, Axis Bank, and State Bank of India
Financials
| 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|---|
| Revenue | 6,475 | 6,232 | 6,222 | 7,220 | 8,299 | 9,014 |
| YoY % | -3.8% | -0.2% | +16.0% | +14.9% | +8.6% | |
| EBITDA | 64 | 74 | 74 | 86 | 72 | 85 |
| YoY % | +15.6% | 0.0% | +16.2% | -16.3% | +18.1% | |
| Net Profit | 432 | 482 | 508 | 1,180 | 1,307 | 1,273 |
| YoY % | +11.6% | +5.4% | +132.3% | +10.8% | -2.6% | |
| EPS | 13.89 | 15.52 | 16.33 | 37.77 | 34.64 | 33.68 |
| YoY % | +11.7% | +5.2% | +131.3% | -8.3% | -2.8% |
Growth Drivers
Historical Growth Drivers: Expansion of branch network, introduction of new digital channels, and growth in retail lending
Future Growth Drivers: Adoption of digital technologies like AI and cloud, strategic partnerships, and increasing focus on rural and semi-urban markets
Examples: Launch of mobile banking app, introduction of digital loan products, and partnership with fintech companies
Market Position
Competitive Position: Mid-sized private sector bank
Estimated Market Share: 1.2% of Indian banking market
Technological Moat: Investment in digital transformation and adoption of new technologies
Strengths
- Over 850 branches and 1,400 ATMs across India
- 23% growth in retail lending in FY2022
- Net NPA ratio reduced to 2.49% in FY2022
- CAR of 12.34% in FY2022
Weaknesses
- Exposure to cyclical industries like real estate and construction
- Stringent regulatory requirements and potential changes in banking regulations
- Intense competition from larger private sector banks and public sector banks
- High concentration of branches and business in southern India
Valuations
Valuations for KTKBANK
| Formula | Bull | Base | Bear | Margin of Safety |
|---|---|---|---|---|
| Ben Graham | ₹ 551 | ₹ 551 | ₹ 203 | 68.3% |
| Peter Lynch | – | ₹ 337 | – | 48.2% |
Rule of thumb (Lynch):
PEG ≈ 1 → Fairly valued
PEG < 1 → Undervalued (growth cheap relative to earnings)
PEG > 1.5 → Overvalued
Outlook
Forward-looking Analysis: KTKBANK is expected to benefit from increasing demand for digital banking, growing retail lending, and improving asset quality. However, the bank needs to navigate regulatory challenges, intense competition, and geographic concentration risks.
Opportunities: Expansion into new markets, adoption of new technologies, and growth in fee-based income
Risks: Cyclical downturn, regulatory changes, and competition from larger banks
Horizon: 3-5 years
Stock Price Performance
| 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 | |
|---|---|---|---|---|---|---|---|---|---|---|
| Price | 77.49 | 128.23 | 103.73 | 122.82 | 42.15 | 65.05 | 57.50 | 129.05 | 237.70 | 179.20 |
| YoY % | +65.5% | -19.1% | +18.4% | -65.7% | +54.3% | -11.6% | +124.4% | +84.2% | -24.6% |
Stock 3 Year Rolling CAGR
| Metric | 2022 | 2023 | 2024 | 2025 | Average |
|---|---|---|---|---|---|
| Revenue | -1.32% | 5.03% | 10.08% | 7.68% | 5.37% |
| EBITDA | 4.96% | 5.14% | -0.91% | -0.39% | 2.20% |
| Net Profit | 5.55% | 34.78% | 37.03% | 2.56% | 19.98% |
| EPS | 5.54% | 34.51% | 28.49% | -3.75% | 16.20% |
| Price | 10.91% | 25.65% | 60.49% | 11.56% | 27.15% |
