Tamilnad Mercantile Bank
Tamilnad Mercantile Bank
BanksKey Fundamentals
MicrocapPrivate BankBanksPrice-based figures as of 9 Oct 2026, 3:31 pm IST · EPS basis: Standalone · TTM
Tapetide Score
Data-driven rating, 0–100. How it works →
Key Insights
Strengths
1- Company's working capital requirements have reduced from 73.9 days to 52.1 days
Weaknesses
5- Company has low interest coverage ratio.
- The company has delivered a poor sales growth of 10.0% over past five years.
- Contingent liabilities of Rs.9,453 Cr.
- Company might be capitalizing the interest cost
- Dividend payout has been low at 14.8% of profits over last 3 years
Growth Rate
AI Analysis — Bull vs Bear
As of the 2026-10-08 close, Tamilnad Mercantile Bank trades at Rs 855.45, giving a market capitalisation of Rs 13,546.18 Cr, a trailing P/E of 9.38 on TTM EPS of Rs 91.21, and a price-to-book of 1.28. TTM profit grew 20% and sales grew 13%. ROE of 13.23% is below the 3-year average of 14% and the 5-year average of 15%. The stock is up 107% over one year and sits about 10% below its 52-week high of Rs 954.2.
- The trailing P/E of 9.38 (as of 2026-10-08) on TTM EPS of Rs 91.21 is a single-digit earnings multiple. That leaves room for re-rating if earnings growth holds.
- Price-to-book of 1.28 (as of 2026-10-08) against an ROE of 13.23% means the market values the bank at a modest premium to book. That is reasonable for a lender earning low-to-mid teens returns on equity.
- TTM profit growth of 20% is faster than both the 3-year profit CAGR of 9% and TTM sales growth of 13%. This points to improving operating leverage or lower credit costs in the recent period.
- Revenue growth has picked up. TTM and 3-year sales growth are both 13%, compared with a 5-year CAGR of 10%.
- The 5-year compounded profit growth of 17% shows profit growing faster than the 10% 5-year sales CAGR over a longer period.
- ROE has stayed in a fairly narrow band: 13.23% currently, 14% last year, 14% over 3 years and 15% over 5 years. This suggests profitability has been steady rather than volatile.
- Working-capital days fell from 73.9 to 52.1. For a bank, though, this screener metric carries limited analytical weight.
- The 1-year stock return of 107% and a price of Rs 855.45, about 104% above the 52-week low of Rs 420 (as of 2026-10-08), show strong positive price momentum.
- ROE has trended down from a 5-year average of 15% and a 3-year average of 14% to 13.23% currently. Returns on equity are gradually weakening.
- The 3-year profit CAGR of 9% lags the 3-year sales CAGR of 13%. Earnings growth has not kept pace with balance-sheet and revenue expansion over that window.
- The 5-year sales CAGR of 10% is modest for a mid-sized private bank. The data flags it as poor sales growth.
- Contingent liabilities of Rs 9,453 Cr equal about 70% of the Rs 13,546.18 Cr market capitalisation (as of 2026-10-08). That is a large off-balance-sheet exposure relative to the bank's equity value.
- Dividend payout has averaged only 14.8% of profits over the last 3 years, and the dividend yield is 1.42% (as of 2026-10-08). Cash returns to shareholders are limited despite the low P/E.
- After a 107% rise over one year, the stock is far above its 52-week low of Rs 420. Much of the valuation gap may already be priced in, and the stock may be more exposed to mean reversion.
- The 3-year stock CAGR is 17%, much lower than the 1-year return of 107%. The recent rally is concentrated in a short period, which raises the risk of volatility.
- ROCE is 6.77%, and the data flags low interest coverage and possible interest capitalisation. These metrics are structurally low for banks because interest expense is core operating cost, so they are less informative than asset-quality and margin data.
This is AI-generated analysis, not financial advice. Do your own due diligence.
AI News Digest
- CASA growth lags deposit growth Oct 1
CASA balances grew 16.26% YoY to ₹17,629 crore, well behind total deposit growth of 25.49% YoY to ₹69,546 crore. That puts the CASA ratio at about 25.3%, which signals a costlier funding mix and possible pressure on margins.
- Lending rate hike may dampen demand Oct 7
TMB raised its Repo Linked Lending Rate by 25 bps to 8.50% from 8.25%, effective October 8, 2026. Higher borrowing costs could slow credit demand and add repayment stress for borrowers whose loans are linked to RLLR.
- Credit-deposit ratio climbing Oct 1
Advances grew 29.37% YoY, faster than deposits at 25.49%, which lifts the CD ratio to about 87.3% (₹60,715 crore / ₹69,546 crore). This leaves less liquidity headroom and could mean the bank needs costlier deposit mobilisation.
- Total business up 27% YoY Oct 1
Total business rose 27.27% YoY to ₹1.30 lakh crore in Q2FY27, a strong growth pace for a mid-sized private bank.
- Advances surge 29% YoY Oct 1
Gross advances expanded 29.37% YoY to ₹60,715 crore in Q2FY27, showing strong loan-book momentum.
- Deposits grow 25% YoY Oct 1
Total deposits grew 25.49% YoY to ₹69,546 crore, so the deposit franchise is broadly keeping up with fast loan growth.
- RLLR hike supports loan yields Oct 7
The 25 bps RLLR increase to 8.50% from October 8, 2026 should reprice linked loans upward, which may help offset rising deposit costs and protect NIMs.
- RBI board appointments at TMB Oct 1
RBI appointed R. Kannan as Additional Director and extended C.S. Ram Kumar's tenure at TMB for two years. This adds regulatory oversight and governance continuity.
- Institutional investor meets scheduled Sep 17
TMB held virtual one-to-one meetings with Bellwether Capital on September 18, 2026 and Rainier Fund on September 24, 2026 at 10:30 am, both disclosed under SEBI LODR Regulation 30. This points to active institutional engagement.
TL;DR: TMB's Q2FY27 business update shows strong balance-sheet growth: total business is up 27.27% to ₹1.30 lakh crore and advances are up 29.37%. The risks are on the funding side. CASA growth of 16.26% is well behind deposit growth, and the CD ratio has risen to about 87%, both of which could squeeze margins. The 25 bps RLLR hike should help loan yields, but it may also cool credit demand. The growth trend is improving, and the full Q2FY27 results on NIMs, asset quality and profitability will show whether this growth is translating into earnings.
Quarterly Results
| Particulars | Jun 2023 | Sep 2023 | Dec 2023 | Mar 2024 | Jun 2024 | Sep 2024 | Dec 2024 | Mar 2025 | Jun 2025 | Sep 2025 | Dec 2025 | Mar 2026 | Jun 2026 |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 1,156 | 1,209 | 1,229 | 1,254 | 1,281 | 1,337 | 1,331 | 1,342 | 1,386 | 1,413 | 1,469 | 1,550 | 1,662 |
| Expenses | 340 | 347 | 327 | 388 | 417 | 423 | 355 | 382 | 407 | 373 | 375 | 443 | 446 |
| Financing Profit | 174 | 186 | 210 | 179 | 150 | 173 | 216 | 186 | 173 | 224 | 271 | 262 | 319 |
| Fin. Margin % | 15% | 15% | 17% | 14% | 12% | 13% | 16% | 14% | 12% | 16% | 18% | 17% | 19% |
| Other Income | 167 | 156 | 158 | 164 | 234 | 227 | 189 | 200 | 231 | 208 | 196 | 242 | 238 |
| Interest | 642 | 676 | 692 | 687 | 715 | 741 | 761 | 774 | 807 | 816 | 823 | 846 | 897 |
| Depreciation | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| PBT | 341 | 342 | 368 | 343 | 383 | 400 | 404 | 387 | 404 | 432 | 467 | 504 | 557 |
| Tax % | 23% | 20% | 23% | 26% | 25% | 24% | 26% | 25% | 25% | 27% | 27% | 26% | 26% |
| Net Profit | 261 | 274 | 284 | 253 | 287 | 303 | 300 | 292 | 305 | 318 | 342 | 374 | 412 |
| EPS in Rs | 16.5 | 17.27 | 17.95 | 15.98 | 18.14 | 19.15 | 18.96 | 18.43 | 19.25 | 20.05 | 21.57 | 23.6 | 25.99 |
| Gross NPA % | 1.56% | 1.7% | 1.69% | 1.44% | 1.44% | 1.37% | 1.32% | 1.25% | 1.22% | 1.01% | 0.91% | 0.73% | 0.69% |
| Net NPA % | 0.66% | 0.99% | 0.98% | 0.85% | 0.65% | 0.46% | 0.41% | 0.36% | 0.33% | 0.26% | 0.2% | 0.18% | 0.17% |
Profit & Loss
| Particulars | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 | TTM |
|---|---|---|---|---|---|---|---|---|---|---|
| Revenue | 3,250 | 3,224 | 3,466 | 3,609 | 3,834 | 4,081 | 4,848 | 5,291 | 5,819 | 6,096 |
| Expenses | 1,366 | 1,350 | 1,231 | 1,355 | 1,470 | 1,276 | 1,327 | 1,490 | 1,505 | 1,637 |
| Financing Profit | -157 | -120 | 89 | 183 | 346 | 818 | 824 | 811 | 1,022 | 1,076 |
| Fin. Margin % | -5% | -4% | 3% | 5% | 9% | 20% | 17% | 15% | 18% | 18% |
| Other Income | 506 | 414 | 526 | 644 | 812 | 629 | 645 | 850 | 877 | 884 |
| Interest | 2,041 | 1,994 | 2,147 | 2,072 | 2,019 | 1,987 | 2,697 | 2,990 | 3,292 | 3,383 |
| Depreciation | 40 | 36 | 30 | 29 | 33 | 54 | 75 | 86 | 93 | 0 |
| PBT | 310 | 259 | 585 | 798 | 1,125 | 1,394 | 1,394 | 1,575 | 1,807 | 1,960 |
| Tax % | 28% | 0% | 30% | 24% | 27% | 26% | 23% | 25% | 26% | — |
| Net Profit | 222 | 259 | 408 | 603 | 822 | 1,029 | 1,072 | 1,183 | 1,338 | 1,444 |
| EPS in Rs | 15.57 | 18.14 | 28.61 | 42.34 | 57.67 | 65 | 67.7 | 74.68 | 84.47 | 91.21 |
| Div. Payout % | 21% | 13% | 0% | 0% | 9% | 8% | 15% | 15% | 15% | — |
Balance Sheet
| Particulars | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|
| Equity Capital | 143 | 143 | 143 | 143 | 143 | 158 | 158 | 158 | 158 |
| Reserves | 3,262 | 3,476 | 3,837 | 4,437 | 5,193 | 6,770 | 7,763 | 8,850 | 9,952 |
| Borrowing | 513 | 0 | 324 | 0 | 0 | 525 | 1,301 | 500 | 700 |
| Deposits | 32,428 | 35,136 | 36,825 | 40,970 | 44,933 | 47,766 | 49,515 | 53,689 | 61,712 |
| Other Liabilities | 1,522 | 1,719 | 1,604 | 1,948 | 2,559 | 2,646 | 2,815 | 3,252 | 2,777 |
| Total Liabilities | 37,868 | 40,473 | 42,733 | 47,499 | 52,828 | 57,866 | 61,552 | 66,450 | 75,300 |
| Fixed Assets | 140 | 138 | 128 | 137 | 211 | 246 | 271 | 284 | 311 |
| CWIP | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Investments | 10,364 | 9,107 | 9,467 | 11,703 | 13,242 | 14,156 | 15,263 | 15,101 | 15,693 |
| Other Assets | 27,364 | 31,228 | 33,137 | 35,658 | 39,374 | 43,464 | 46,019 | 51,065 | 59,296 |
| Total Assets | 37,868 | 40,473 | 42,733 | 47,499 | 52,828 | 57,866 | 61,552 | 66,450 | 75,300 |
Cash Flow
| Particulars | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|
| Operating | -389 | 0 | 567 | -670 | 1,325 | -1,270 | -611 | 1,899 | -101 |
| Investing | -26 | 0 | -20 | -37 | -107 | -89 | -100 | -99 | -118 |
| Financing | 472 | 0 | 269 | -324 | -71 | 1,088 | 697 | -960 | 26 |
| Net Cash Flow | 58 | 0 | 816 | -1,031 | 1,147 | -270 | -14 | 840 | -193 |
| Free Cash Flow | -414 | 0 | 547 | -707 | 1,218 | -1,358 | -711 | 1,800 | -219 |
| CFO/OP | -21 | 0 | 25 | -30 | 56 | -32 | -8 | 60 | 8 |
Ratios
| Particulars | Mar 2018 | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 | Mar 2024 | Mar 2025 | Mar 2026 |
|---|---|---|---|---|---|---|---|---|---|
| ROE % | 7% | 7% | 11% | 14% | 17% | 17% | 14% | 14% | 14% |
Insights
BetaAI-extracted from concalls & annual reports · figures as reported, with sources
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89 extracted metrics + investor summaries across FY16–FY27.
Documents
Frequently Asked Questions about Tamilnad Mercantile Bank
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Company Information
Incorporated in 1921, Tamilnad Mercantile Bank (TMB) is one of the oldest private sector banks in India. It offers an array of banking and financial services to retail customers, micro, small, and medium enterprises (MSMEs).[1]
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