SOUTHBANK
Micro CapThe South Indian Bank Limited
Financial Services
The South Indian Bank Ltd. is a private sector bank in India, undergoing a transformation journey focused on improving asset quality, enhancing branch productivity, and driving digital efficiency. The bank aims for a diversified loan book with momentum in MSME and Retail segments, supported by a pan-India presence and digital initiatives.
One read, four checks
75+ is strong, 60-74 is usable, 45-59 is mixed, and below 45 needs caution. These are research lenses, not buy/sell instructions.
Mixed fundamentals, management trust is acceptable, price trend is neutral, and recent execution is consistent.
Fundamental lens: valuation, quality, growth, balance sheet, and cash flow.
low confidence · 0/0 claims checked
Timing lens: price trend and sector relative strength.
Rolling lens: recent quarterly delivery, not the latest single-result score.
Quarter ended 31 Mar 2026
Average · 45/100Rev +8% YoY · PAT +19% YoY · operating leverage
| Metric | This quarter | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹2,559 Cr | +7.8% | +1.6% |
| EBITDA | NDF | NDF | NDF |
| Operating margin | NDF | NDF | NDF |
| PAT | ₹407 Cr | +19.0% | +8.8% |
| PAT margin | 15.9% | +149 bps | +105 bps |
NDF means not disclosed in the current structured filing feed. It is intentionally not treated as zero.
Where growth can come from, and what can break the case
SOUTHBANK reports strong Q4FY26 with 19% YoY PAT growth and significant asset quality improvement, achieving its best-ever annual net profit of Rs. 1,455 crore for FY26.
The bank's transformation efforts appear to be yielding results, particularly in asset quality and profitability. The shift towards retail and MSME segments, coupled with digital initiatives, supports future growth. However, the sequential decline in NII and non-interest income in Q4FY26 warrants close monitoring despite annual growth.
Loan Book by Vertical (Q4FY26)
Latest issuer-disclosed distribution across 4 reported categories.
Diversified Loan Book
Shift from Corporate to MSME and Retail segments is gaining momentum, with ~62% of the loan book now outside corporates.
Digital Channel Focus
Focus on digital channels to drive operating efficiency, with 98.5% of total transactions through digital channels in Q4FY26.
Branch Productivity Improvement
Significant improvement in branch productivity, with Branch Sales Value Added (Indexed) reaching 199% in Q4FY26 (rebased to Q4FY24=100).
MSME & Retail Disbursements
MSME disbursement grew 24% YoY and Retail Loans (incl. gold) disbursement grew 70% YoY in Q4FY26, indicating strong traction.
Improving Asset Quality
GNPA and NNPA are at their lowest levels, with 77% of current GNPA originating from the old loan book (pre-Oct'2020).
Strong Capital Adequacy
CRAR of 19.66% and CET1 of 18.76% are well above regulatory requirements, providing a buffer for growth.
Digital Transformation
Multitude of digital initiatives, including AI capabilities and STP models, are enhancing customer experience and operational efficiency.
Net Interest Income (NII) Trend
NII for FY26 was Rs. 3,437 Cr, a -1% YoY decline from Rs. 3,486 Cr in FY25, despite a QoQ increase in Q4FY26.
Non-Interest Income Volatility
Non-Interest Income declined -33% YoY and -21% QoQ in Q4FY26, primarily due to a -100% decline in Treasury & Forex income.
What management said, and what results must prove
Issuer guidance and extracted claims are tracked against later reported outcomes. Treat these as management statements, not IndiaPulse forecasts.
Financial services companies require both YoY for seasonal trends and overall growth, and QoQ for sequential momentum in disbursements, asset quality, and operational efficiency. The bank's transformation also necessitates tracking sequential progress.
Gross Advances Growth
Gross Advances grew to Rs. 100,274 Cr in Q4FY26, up 14.5% YoY from Rs. 87,579 Cr in Q4FY25. Average advances grew 14% YoY.
Disbursements Growth
Total disbursements for FY26 were Rs. 180,023 Cr, up 10.3% YoY from Rs. 163,270 Cr in FY25. Retail Loans (incl. gold) disbursements grew 70% YoY in Q4FY26.
Net Interest Margin (NIM)
NIM for Q4FY26 was 2.95%, down from 3.21% in Q4FY25 (-26 bps YoY), but up from 2.86% in Q3FY26 (+9 bps QoQ).
Cost of Funds
Cost of Funds was 4.77% in Q4FY26, down from 4.96% in Q4FY25 (-19 bps YoY) and stable QoQ.
Building Frictionless Processes
Management is focused on implementing STP (Straight Through Processing) models for various credit proposals (MSME, LAP, Vehicle, Housing) to improve TAT and efficiency.
Growing Non-Branch Distribution & Partnerships
Strategic tie-ups for co-lending, asset partnerships (e.g., with CapFloat for Amazon customers), and fintech partnerships for deposits are key focus areas.
Improving Operating Efficiency
Expenses are being tracked closely, with muted sequential growth. Management expects further progress in improving operating leverage.
Staff Training and Re-skilling
Significant investment in training, with 13,287 staff trained in FY26 (vs 7,891 in FY25), focusing on culture change and domain expertise.
Numbers and claims to verify in the next filings
| Checkpoint | Current evidence | What to verify next |
|---|---|---|
| Net Interest Margin (NIM) | 2.95% (Q4FY26) | Sustained QoQ improvement and stabilization of NIM, given the YoY decline. |
| Net Non-Performing Assets (NNPA) | 0.29% (Q4FY26) | Continued low NNPA levels and effective management of the remaining 'old book' GNPA. |
| Retail & MSME Advances Growth | Retail Loans (incl. gold) disbursement +70% YoY, MSME disbursement +24% YoY (Q4FY26) | Consistent high growth rates in these segments to drive overall loan book expansion and diversification. |
| Cost-to-Income Ratio | 55.3% (Q4FY26) | Further reduction in Cost-to-Income ratio, indicating improved operational efficiency from digital initiatives and cost optimization. |
Verification checkpoints are IndiaPulse research interpretation, not investment advice.
Trend score and candlestick chart
60BullishSMA20 +4.0% / mo · near 52W high
Technical chart
SOUTHBANKdaily · 1Y+18.0%Technical trend read
Mixed signalsSignals are conflicting — long-term trend unclear. RSI 72. Wait for confirmation.
- SMA20 rising (~3.6% over last month) — short-term momentum positive.
- RSI(14) at 72 — overbought zone; risk of mean reversion.
- MACD above signal, histogram expanding — bullish momentum building.
- Within 3% of 52-week high — testing resistance.
Mechanical read from the price + indicator series above. Not a recommendation — technical setups can reverse without warning, especially around earnings and macro events.
Valuation, score drivers, trust methodology, financials, and peers
Use these sections after reviewing the decision summary, latest result, thesis, management accountability, and technical timing above.
Fundamental score breakdown
FAIR VALUEWhy this score?
Top U-Score contributors and drags from the latest stored fundamentals.
Positive drivers
- Fair-value margin of safety is positive at 75.0%.
- Valuation contributes 27/30 to the score.
- Growth contributes 14/25 to the score.
Main drags
- Quality is weaker at 5/20; verify the latest quarterly trend.
- Cash flow is weaker at 3/10; verify the latest quarterly trend.
- Balance sheet is weaker at 7/15; verify the latest quarterly trend.
Bank valuation: P/B adjusted for ROE and asset quality
Banks are balance-sheet businesses, so book value quality matters more than simple earnings multiples.
Stored run vs live recompute
This shows the stored score trend when snapshots exist, and also compares the latest stored nightly score with a live recompute from current fundamentals and price.
Score history
12 stored score snapshots. Latest stored move: +0 points.
Factor attribution
Trust asks: does management behaviour match later outcomes? Higher is better, but confidence and evidence depth matter as much as the number.
Mixed Trust: Claim history is still being built. It ranks around the 57th percentile of the scored universe and 75th percentile within Financial Services. Main check: cash conversion is weak at 55/100.
Healthy Trust Lite: Promoter pledge is zero. Key concern: ROCE is low at 6.4%.
Usable, but needs evidence. Treat guidance with a margin of safety.
overall median 67 · Financial Services: 75th pctile, median 62 · Micro: 40th pctile, median 71
0 documents indexed, but claim history is not strong enough yet.
0 claims extracted · No contradicted claim yet
How to read this Trust Score
Mixed Trust · low confidenceRead Trust alongside U-Score, result consistency, and technical trend. A cheap stock with weak Trust needs a larger margin of safety; a high Trust score does not make an expensive stock attractive by itself.
Forensic breakdown
Read low sub-scores as due-diligence warnings, not automatic sell signals.
Trust positives
- ▸Promoter pledge is zero.
- ▸Debt/equity is 0.03.
- ▸8/8 recent quarters had positive YoY revenue growth.
- ▸8/8 recent quarters had positive YoY PAT growth.
Trust risks
- ▸ROCE is low at 6.4%.
Trust Lite uses financial behaviour only. Prefer claim-tested Trust when enough concall claims have later outcomes.
Intrinsic value
Fundamentals
Valuation
- P/E
- 7.88
- P/B
- 1.00
- EV/EBITDA
- —
- Market Cap
- 11465.00Cr
Profitability
- ROE
- 13.50%
- ROCE
- 6.42%
- ROA
- 1.03%
- Dividend Y
- 0.91%
Growth (CAGR)
- Revenue 5Y
- 6.00%
- EPS 5Y
- 88.00%
- Revenue 3Y
- 11.00%
- EPS 3Y
- 23.00%
Balance Sheet
- Debt/Equity
- 0.03
- Interest Coverage
- —
- Altman Z
- 1.91
- Book Value
- 43.60
Cash Flow
- FCF Yield
- —
- FCF Positive Y
- 3/5
- OCF
- 3907.00 Cr
- EPS TTM
- 5.56
Shareholding
- Promoter Hold
- —
- Promoter Pledge
- 0.00%
- Momentum 52W
- 84%
Financial History
Updated 9/6/2026
Revenue
₹ CrNet Profit
₹ CrReturn on Equity
%Peers
Business-comparable peers in Financial Services — ranked by industry, sub-sector, theme-tag overlap, market cap, and U-Score similarity. Green cells mark the best available peer metric in this table.