The banking stock touched an intraday high of Rs 184.40, up 9.56 per cent on the BSE. A total of 13.65 lakh shares of the firm were traded, generating a turnover of Rs 24.70 crore.
Bandhan Bank shares surged over 9 per cent today after the lender reported its Q2 earnings. The banking stock touched an intraday high of Rs 184.40, up 9.56 per cent on the BSE. A total of 13.65 lakh shares of the firm were traded, generating a turnover of Rs 24.70 crore. The market capitalisation of the bank rose to Rs 29,440 crore on the BSE.
Bandhan Bank shares are trading above the 5-day moving average but below the 20-day, 50-day, 100-day and 200-day moving averages. The large cap stock has declined 15 per cent in a year and 25.13 per cent since the beginning of this year. Bandhan Bank reported a 30 per cent rise in net profit in Q2 from Rs 721.2 crore in Q2FY24, year-on-year to Rs 937.4 crore. Net interest income (NII) grew 21 per cent to Rs 2948.2 crore in the previous quarter as against Rs 2,443 crore in the same quarter last year. Gross non-performing assets (GNPA) stood at 4.68% in the previous quarter as against 4.23% in the June 2024 quarter. Net NPA stood at 1.29% in the second quarter as against 1.15% quarter-on-quarter. Quarter-on-quarter gross NPAs rose to Rs 6,105.3 crore as against Rs 5,304.4 crore, while quarter-on-quarter net NPAs stood at Rs 1,620.2 crore as against Rs 1,396.4 crore.
Nuvama said second quarter earnings came in better than peers. It has a neutral rating on the stock with a price target of Rs 190.
“Bandhan’s EEB book looks better than peers given the huge write-offs and early guardrails in the past few years. However, the bank cannot afford to insulate itself from MFI risks, only that the pain will be less. Given the low visibility on MFIs, we maintain ‘Hold’ and cut our price target to Rs 190 from Rs 200,” Nuvma said.
Brokerage Jefferies has set a price target of Rs 240 with a buy call.
The brokerage said that not only did profit exceed estimates but the quality of MFI loans also remained good. A conservative cooling-off period, large share of unique borrowers, rising credit-scores and slower growth in 2 years have helped, Jefferies said.
Nomura upgraded its stance to neutral with a price target of Rs 180.
The brokerage said the lender reported stable performance in a difficult environment. It is cautious as the MFI sector outlook remains challenging. The bank reported healthy loan and deposit growth, but deterioration in asset quality on high slippages is a concern.
Kotak Institutional Equities has recommended buy on Bandhan Bank after Q2 earnings. It has a price target of Rs 250 on the banking stock. The brokerage said the 30% year-on-year earnings growth was healthy, led by 17% year-on-year operating profit growth and a nearly 5% year-on-year decline in provisions. Early warning indicators suggest that the banking portfolio may be resilient in this MFI cycle.
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