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Dhanlaxmi Bank Ltd

| Audited Financial Results for the Quarter and Year Ended March 31, 2026

BULLISH SENTIMENT

Report Source

⬤28th Apr 26

Summary : Dhanlaxmi Bank reported strong financial performance for FY26, driven by improved profitability, asset quality, and capital adequacy, despite some audit scope limitations.

Quarterly Report Analysis & Insights

Financial Disclosures

  1. Interest expended: 97,915 Lakhs (FY26).
  2. Operating expenses: 59,844 Lakhs (FY26), including Employees cost (32,697 Lakhs).
  3. Provisions (other than tax) and Contingencies: 7,806 Lakhs (FY26).
  4. Interest earned: 160,148 Lakhs (FY26).
  5. Other income: 19,239 Lakhs (FY26).
  6. Segment Revenue: Retail Banking (110,093 Lakhs), Treasury (29,432 Lakhs), Corporate/Wholesale Banking (37,817 Lakhs).
  7. Net cash flow from operating activities: 63,149 Lakhs (FY26).
  8. Net cash flow from investing activities: (78,951) Lakhs (FY26).
  9. Net cash generated from financing activities: 15,000 Lakhs (FY26).
  10. Total Assets/Liabilities: 2,122,376 Lakhs (FY26).
  11. Deposits: 1,864,288 Lakhs (FY26).
  12. Advances: 1,491,806 Lakhs (FY26).
  13. Capital Adequacy Ratio: 18.92% (FY26).
  14. Standalone results, as the bank operates only in the domestic segment.

Corporate Overview

  1. Primarily concentrated in India, operating only in the domestic segment.
  2. Corporate Office located in Thrissur, Kerala.
  3. Evaluating potential impact of new Labour Codes on employee benefits, currently assessed as not material.
  4. Banking operations, including Retail, Corporate/Wholesale, and Treasury.
  5. Digital banking products are integrated into the Retail Banking segment.
  6. Formal and compliant in reporting financial results.
  7. Treasury
  8. Retail Banking
  9. Corporate/Wholesale Banking
  10. Other Banking Operations
  11. 246 Branches and processing centres.

Risk Factors

  1. Pillar 3 disclosures were not audited.
  2. Audit opinion relies on branch auditors' reports.
  3. New Labour Codes' impact still being monitored.
  4. Management assesses bank's going concern ability.

Key Drivers

  1. Net profit increased significantly year-on-year.
  2. Gross and Net NPAs substantially reduced.
  3. Capital Adequacy Ratio showed strong improvement.
  4. Operating and Net Profit Margins expanded.

Auditor’s Report

  1. Unmodified opinion on the Audited Financial Results.
  2. Pillar 3 disclosures (Leverage Ratio, LCR, NSFR) under Basel III were not audited.
  3. Reliance on reports of branch auditors for 246 branches covering significant assets, revenue, deposits, and NPAs.

Board Commentary

  1. Evaluation of potential impact from new Labour Codes (Wages, Industrial Relations, Social Security, OSH) on employee benefits, currently assessed as not material.
  2. 78 projects under implementation accounts with 23,444 lakhs outstanding at year-end.
  3. 6 accounts with 1,351 lakhs under resolution process implemented.

Corporate Governance

  1. Auditors confirm compliance with Code of Ethics issued by ICAI.
  2. Auditors confirm compliance with ethical requirements regarding independence.
  3. Audit Committee reviewed and recommended financial results.

Management Discussion & Analysis

Performance Drivers

  1. Increased interest earned and other income.
  2. Improved asset quality with reduced NPAs.
  3. Higher operating and net profit margins.

Risk Control Measures

  1. Bank continues to monitor developments regarding new Labour Codes.

Critical Risks

  1. Uncertainty regarding Pillar 3 disclosures not audited.
  2. Reliance on branch auditors for a significant portion of assets and revenue.