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PNB Shares Surge 8 Percent Post Q2 Results: Analysts Split on Buy or Sell
- •Punjab National Bank shares rallied up to 8 percent on Monday following strong second-quarter financial results.
- •CLSA maintains an outperform rating on PNB with a target price of 140 rupees, highlighting a 20 percent profit beat and accelerated loan growth.
- •Citi holds a sell rating on the stock with a revised target price of 110 rupees, citing potential downside from current levels.
- •PNB reported a net interest margin improvement of 8 basis points alongside stable asset quality and strong loan growth.
- •Out of 23 analysts covering the stock, 14 recommend buying, 3 suggest holding, and 6 recommend selling.
Key Questions Answered
CLSA has given an "outperform" rating on Punjab National Bank with a target price of ₹140 per share, indicating an upside of 20.4% from its previous close. The firm noted that PNB's Q2 profit after tax beat estimates by 20% due to strong net interest income and one-off recoveries.
Citi maintains a "sell" recommendation on PNB with a target price of ₹110, implying a 5.4% decline from its previous close. The brokerage highlighted that the runoff of wholesale deposits via FCNR inflows reduced cash on deposits by 5 basis points.
PNB reported a net profit of ₹5,532 crore for the September quarter, up 12.8% year-on-year. Asset quality improved sequentially with Gross NPA dropping to 2.55% and Net NPA falling to 0.25%, even though fresh slippages increased to ₹2,395 crore.
