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PNB Stocks Update: PNB’s stock rises on the back of solid Q4 earnings, but brokerages advise selling given the high valuations.
PNB’s shares have increased by more than 29% so far this year, outpacing the benchmark Nifty 50 index’s 1% gain.
Kotak Institutional Equities analysts released a “sell” rating for PNB, noting that the company has just experienced a significant increase.
Kotak Institutional Equities analysts gave PNB a “sell” rating, citing the stock’s recent strong rise. Lately
Punjab National Bank’s stock increased 1.8% to Rs 124.3 per share on May 10 following the bank’s profit for the January–March (Q4FY24) quarter more than quadrupled year over year (YoY) to Rs 3,010 crore. Brokerages, citing costly valuations, continued to maintain “sell” calls on the public lender, nevertheless.
PNB’s shares have increased by more than 29% so far this year, outpacing the benchmark Nifty 50 index’s 1% gain. Prior to this, on April 30, 2024, PNB stock reached a 52-week high of Rs 142 per share.
PNB Stocks Update
A’sell’ rating was expressed by Kotak Institutional Equities analysts on PNB, citing the recent steep increase in the stock price. “We have a target price of Rs 105 per share and value the bank at 1x BVPS (adjusted) and 8x March 2026E EPS for RoEs of 12 percent in the medium term,” they stated.
Additionally, Nirmal Bang released a “sell” recommendation for PNB, indicating a decline of more than 12 percent from present levels and a target price of Rs 110 per share. The earnings projection for FY26 was increased by 3.5 percent by analysts; however, the expected return on equity (RoE) and return on asset (RoA) for FY26 remain lower at 0.8 percent and 12 percent, respectively.
In Q4FY24, PNB’s net interest income (NII) increased by 9% YoY to Rs 10,363 crore. When the quarter concluded on March 31, the lender’s capital adequacy ratio was 15.97 percent, up from 14.63 percent the previous quarter.
Aside from that, the lender’s asset quality increased, with the gross non-performing asset ratio falling 51 basis points (bps) to 5.73 percent in a sequential manner. Additionally, the net non-performing assets (NPA) ratio increased, rising from 0.96 percent to 0.73 percent in Q4FY24.
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