Bandhan Bank Rises 2% On Robust Growth In Q1 Loans, Deposits; What Should Investors Do?
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Shares of Bandhan Bank surged 2 per cent to Rs 214 per share on July 4 after it exhibited strong growth in advances and deposits in the April-June quarter (Q1FY25).
Bandhan Bank Ltd has reported a 21.8 per cent year-on-year (YoY) rise in loans and advances at Rs 1,25,619 crore for the June quarter compared with Rs 1,03,169 crore in the same quarter last year. This is against Federal Bank’s gross advances that grew 20 per cent to Rs 2,24,139 crore from Rs 1,86,593 crore in the corresponding quarter last year. YES Bank, on the other hand, said its loans and advances for the June quarter jumped 14.8 per cent year-on-year (YoY) to Rs 2,29,920 crore in the June quarter from Rs 2,00,204 crore in the same quarter last year.
In the case of deposit growth, Bandhan Bank said total deposits were up 22.8 per cent YoY to Rs 1,33,203 crore from Rs 1,08,480 crore. Bandhan Bank said its CASA deposits were up 13.8 per cent at Rs 44,453 crore.
On the other hand, its liquidity coverage ratio stood at 149.5 percent as of June-ended quarter.
In the past month, the stock of this private sector lender rose over 18 per cent, outperforming the benchmark Nifty 50 index that climbed by 11 per cent. Earlier, Bandhan Bank had hit a 52-week high of Rs 263 apiece on January 4, 2024.
What Analysts Say?
Earlier, analysts at Axis Securities had shared ‘hold’ rating on the lender amid elevated operating expenditure and lower margins clocked in the March-ended quarter.
“Factoring in elevated opex and gradual decline in margins, we reduce our earnings estimates by 5-6 per cent over FY25-26E. We expect Bandhan to deliver RoA/RoE of 2-2.1 per cent/17-18 percent over the medium term. While tapering slippages and improving growth is likely to support margins, the shift in the portfolio mix will weigh on margins. Thus we expect NIMs to remain stable at ~7.4-7.5 percent over the medium term,” the brokerage firm added.
Based on recent 23 analyst recommendations, Bandhan Bank is a consensus rating of ‘Hold’ as per Trendlyne.
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