In a remarkable trading session on Tuesday, January 27, shares of Karur Vysya Bank witnessed a substantial surge of 12%, climbing to a fresh all-time high of ₹298 per share. This impressive rally was primarily driven by investor optimism following the bank's robust December quarter performance, which showcased significant improvements across key financial metrics.
Strong Quarterly Earnings Fuel Investor Confidence
The private sector bank, after market hours on Friday, unveiled its financial results for the third quarter ending December 2025. The report revealed a substantial 39% year-on-year increase in net profit, which soared to ₹690 crore. This marks a notable improvement from the ₹496 crore net profit recorded in the same quarter of the previous year, and also represents growth from the ₹574 crore reported in the preceding September quarter.
Key Financial Indicators Show Positive Momentum
Several crucial financial parameters demonstrated healthy growth during the quarter. The bank's net interest income (NII), which measures the difference between interest earned from lending activities and interest paid to depositors, expanded to ₹1,239 crore. This represents a solid increase from the ₹1,081 crore reported in the corresponding quarter of the previous fiscal year.
Furthermore, the pre-provision operating profit showed robust improvement, rising by 23% year-on-year to reach ₹1,005 crore from ₹815 crore. On the provisions front, the bank recorded provisions of ₹104 crore for Q3FY26, which marks a reduction from the ₹147 crore set aside during Q3FY25.
Asset Quality Shows Consistent Improvement
The bank's asset quality metrics displayed positive trends, with gross non-performing assets (NPAs) declining by 12 basis points year-on-year to settle at 0.71%. Similarly, net NPAs experienced a marginal decrease of one basis point year-on-year, reaching 0.19%. These improvements indicate the bank's effective management of credit risk and recovery processes.
Deposit Growth and Advance Expansion
Karur Vysya Bank reported substantial growth in its deposit base, with total deposits increasing by 16% year-over-year to reach ₹2,11,647 crore. Within this, term deposits showed particularly strong performance, rising by 17% year-on-year to ₹83,396 crore.
The bank's CASA (Current Account Savings Account) deposits also demonstrated healthy growth, registering an 11% year-on-year increase. Specifically, savings account deposits grew by 10%, while demand deposits expanded by 12% during the period.
In terms of advances, the RAM Verticals – encompassing Retail, Personal Banking, Agriculture, and Commercial segments – recorded impressive growth. These verticals saw an increase of ₹13,383 crore, rising from ₹70,005 crore to ₹83,388 crore, representing a substantial 19% year-on-year expansion.
Sustained Bullish Trend in Share Performance
Karur Vysya Bank shareholders have been witnessing a sustained upward trajectory in the bank's stock price over recent months. The shares have been on a consistent upward journey since June 2022, maintaining their positive momentum despite occasional profit-booking phases. Following such periods, the stock has demonstrated strong recovery capabilities, resulting in a significant overall rally.
During this extended bullish phase, the bank's shares have appreciated remarkably from around ₹37.50 per share to the current trading levels near ₹295, translating into an extraordinary gain of approximately 700%. The stock concluded the 2025 calendar year with an impressive 46% gain, marking its fifth consecutive annual positive performance. In the current year alone, the shares have already registered an additional 12% appreciation.
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