PNB hits 52-week high: Vaishali Parekh gives ‘buy’ tag to banking stock | Popgen Tech


Government-owned Punjab National Bank (PNB) on Tuesday saw a bull run with the stock hitting a fresh 52-week high. In early deals, the bank stock rose more than 4%. Based on the technical view, Prabhudas Lilladher’s Vaishali Parekh suggests buying PNB shares as a decisive break above 57 levels anticipate further up.

At the time of writing, PNB shares were trading at 56 each with 1.63% on the BSE. The stock hit a new 52-week high of 57.40 a piece earlier today. The bank’s market cap is approx 61,662 crore. Year to date, the stock is up nearly 34%.

On Tuesday, Prabhudas Lilladher’s Vice President – Technical Research, Vaishali Parekh said, “PNB has moved almost 12% since our last analysis and is now approaching the first resistance level. Decisive breach” above 57 anticipates further head movement to 80 and 100 levels. Any pullback or retest of breakout levels will be a good buying opportunity. We suggest you buy and accumulate this stock.”

Recently, PNB issued and allocated Basel III compliant Tier-II capital bonds with a coupon rate of 7.89% per annum — aggregating to 4,000 crore on a private placement basis.

Year to date, the stock is up nearly 34%.

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Year to date, the stock is up nearly 34%. (Chart by Prabhudas Lilladher)

Last month, PNB received approval for the divestment of the bank’s entire/part stake in UTI Asset Management Company in single or multiple segments. The sale will be made for the realization of the return on the investment. The timeline, percentage of shares for divestment, and divestment value are yet to be finalized.

In Q2FY23, PNB posted a 63% drop in net profit to 411.3 crore compared to a profit of 1,105.2 crore in the same quarter last year. Net interest income (NII), however, jumped by 30.2% to 8,271 crore in Q2FY23 against 6,352.8 crore in Q2 of FY22. The bank’s provisions for bad loans went up 3,555.98 crore against 2,692.74 crore a year ago quarter. While its gross non-performing assets (NPAs) declined to 10.48% of gross advances from 13.36% in Q2FY22.

Currently, PNB’s earnings per share is 1.86, while its price-to-equity ratio is 1.86 times. Its return on equity (RoE) is 2.07%.

Disclaimer: The views and recommendations made above are those of individual analysts or brokerage firms, and not of Mint.

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