Bandhan Bank shares: Street cheers lenders double digit loan growth, improving asset quality; analysts see up to 43% upside
Bandhan Bank shares were in demand on Monday after the lender reported a largely positive set of quarterly numbers. A number of brokerages have given a thumbs-up to Bandhan Banks Q4 results with analysts seeing upside potential of as much as 43 per cent in the stock price.
Bandhan Bank shares rose on Monday, trading in high volumes, after the lender reported significant improvement in its asset quality in the March quarter though its profit dropped 57.5 per cent compared with the corresponding period a year ago. A number of brokerages retained positive views on the stock with targets implying a potential upside of as high as 43 per cent.
The Bandhan Bank gained by as much as Rs 6.6 or 2.8 per cent to Rs 244.6 apiece during the session on BSE. Shares finished the day 1.5 per cent stronger at Rs 241.5 apiece. As many as 5.3 lakh Bandhan Bank shares changed hands for the day on the bourse as against a daily average of 2.4 lakh in the past two weeks, according to provisional exchange data.
Bandhan Bank Q4 results
After market hours on Friday, Bandhan Bank reported a net profit of Rs 808.3 crore for the three-month period as against a net profit of Rs 1,902.3 crore for the year-ago period. Its net interest income, or the income between interest earned and interest paid, declined 2.7 per cent to Rs 2,471.8 crore for the March quarter, according to a regulatory filing.
Bandhan Bank's net interest margin (NIM), a key measure of profitability for lenders, improved to 7.3 per cent for the March quarter from 6.5 per cent for the previous three months.
The lender saw improvement in its asset quality, measured as a percentage of non-performing assets (NPAs) or bad loans in total loans.
Its gross NPAs decreased by 228 basis points sequentially to 4.87 per cent and net NPAs by 69 basis points to 1.17 per cent, according to the filing.
The bank clocked double-digit growth in loans and deposits, at 10 per cent at 12 per cent respectively.
Bandhan Bank dividend
The Bandhan Bank board recommended a dividend of Re 1.5 per share.
What brokerages make of Bandhan Bank Q4 results
| Brokerage | Rating | Target price |
| CLSA | Buy | Rs 320 |
| Jefferies | Buy | Rs 340 |
| Goldman Sachs | Buy | Raised to Rs 294 from Rs 269 |
| Nomura | Buy | Reduced to Rs 310 from Rs 320 |
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