- Brokerages have mixed views on Punjab National Bank despite raised target prices
- Citi cut FY26 NIM guidance and kept a sell rating with a target of Rs 115
- Kotak Securities sees margin dip as temporary and raised target to Rs 140
Brokerages remain divided on Punjab National Bank even as most raise target prices, citing pressure on margins but comfort on asset quality and recoveries.
Global brokerage firm Citi maintained a 'sell' rating while hiking its target price to Rs 115 from Rs 108. The brokerage flagged a 7 bps sequential contraction in NIM and trimmed FY26 NIM guidance. Slippages were contained below 0.7%, with the bank creating floating provisions towards ECL. Management reiterated confidence in achieving a 1% RoA in FY26, supported by recoveries, modest credit costs and flat NIMs.
Kotak Securities retained an 'add' rating and raised its target to Rs 140 from Rs 125. It termed the margin decline a temporary blip, noting overall profitability remains steady. While NIM declined 10 bps this quarter, earnings growth and RoE stayed healthy. Slippages were low at 70 bps, though credit costs rose due to a one-off.
Jefferies continued with a 'buy' rating and increased its target to Rs 150 from Rs 145. The December quarter saw weak margins, with ECL provisioning dragging earnings. However, profit exceeded estimates, aided by higher other income and lower taxes. Slippages remained stable and core credit costs benign. The bank expects the ECL transition to impact about 0.8% of loans over the next five years.
Punjab National Bank Share Price Today
The scrip rose as much as 1.80% to Rs 130.35 apiece, pared gains to trade 0.07% lower at Rs 127.96 apiece, as of 9:33 a.m. This compares to a 0.33% decline in the NSE Nifty 50 Index.
It has risen 26.07%% in the last 12 months. Total traded volume so far in the day stood at 0.49 times its 30-day average. The relative strength index was at 35.39.
Out of 21 analysts tracking the company, 11 maintain a 'buy' rating, four recommend a 'hold,' and six suggest 'sell,' according to Bloomberg data. The average 12-month consensus price target implies an upside of 3.5%.
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