Are Indian Overseas Bank latest results good or bad?

Indian Overseas Bank's latest results for Q3 FY26 reflect notable operational trends, particularly in profitability and asset quality. The bank reported a net profit of ₹1,226.42 crores, which demonstrates a significant year-on-year growth of 57.81%. This performance is complemented by a net interest income of ₹3,059.14 crores, marking a year-on-year increase of 20.57%. Additionally, the total income for the quarter reached ₹9,214.24 crores, up 8.61% from the previous year.
The asset quality metrics also show improvement, with the gross non-performing asset (NPA) ratio declining to 1.83% from 2.72% a year ago, and net NPAs reducing to 0.28%. This indicates effective credit management and provisioning practices, as the provision coverage ratio remains robust at 97.48%.

On a quarter-on-quarter basis, the bank's net profit advanced by 10.38%, reflecting consistent operational resilience. However, the interest earned showed a slight sequential growth of 4.12%, down from previous quarters, which may warrant further observation.

Despite these positive operational indicators, the company saw an adjustment in its evaluation, reflecting the market's cautious stance regarding its valuation relative to peers. The stock has underperformed significantly over the past year, declining 33.32% compared to the broader Public Sector Bank index, which has seen gains.

Overall, Indian Overseas Bank's financial results indicate strong underlying operational performance, particularly in profitability and asset quality, while also highlighting the need for attention to valuation concerns and market sentiment.