Shares of Bandhan Bank slipped 2% on the BSE in Friday’s trade after the brokerage firm Macquarie downgraded the stock to 'Underperform' from 'Neutral' and cut its target price to Rs400 from Rs560.
The brokerage firm expects the stock to underperform despite strong fundamentals. Further, it said that post the Gruh Finance acquisition, the risk of another expensive or ill-conceived merger is overhang.
The bank’s posted its third quarter result on Thursday as its net profit improved 10.4% yoy to Rs331.3cr against Rs300cr in the corresponding period last year. The result was in line with consensus estimates due to higher NII.
During the quarter, it made provisions of Rs385cr towards the exposure to IL&FS. Exposure to IL&FS is now fully provided for during the quarter.
Its GNPA for the third quarter stood at 2.41% against 1.29% qoq, an increase of 112bps. NNPA for the quarter came in at 0.7%, almost flat qoq.
Bandhan Bank Ltd is currently trading at Rs461.30 down by Rs10.4 or 2.2% from its previous closing of Rs471.70 on the BSE. The scrip opened at Rs472 and has touched a high and low of Rs472 and Rs459.05 respectively.
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