Equirus Securities has an add call on Karur Vysya Bank with a target price of Rs 122.

The current market price of Karur Vysya Bank is Rs 112.80.

Time period given by the brokerage firm is 14 months when Karur Vysya Bank price can reach defined target.

"Strong commission income (+37 per cent yoy) and contained opex (+3.6 per cent yoy) led to an above-expected PAT of Rs 715mn (-38 per cent yoy) for Karur Vysya Bank (KVB) in 3QFY18. Slippages remained elevated (~6.4 per cent), on expected lines, pushing up GNPA/ NNPA ratios to 5.9 per cent/3.9 per cent. We believe various measures undertaken by KVB to focus on retail/commercial segments would take time to yield results; these measures include (i) scorecard-based credit appraisal of retail/commercial loans, (ii) technology-driven TAT reduction in loan sanctions, (iii) rework on the branch incentive structure, and (iv) tapping a 6.8mn customer base for cross-selling of products. Slippages from watch-list of Rs 6.5bn will keep pressure on asset quality over the next couple of quarters. We raise our provision estimates and pare FY18E/FY19E PAT by 14 per cent/1 per cent. Retain ADD with a March 2019 TP of Rs 122 (vs. Rs 131 earlier) set at a 1.5x March 2019 ABV," Equirus Securities said in a report.