Shares of
surrendered early gains to fall nearly 1% to ₹1,585.80. In the morning trade, the stock made an intraday high of ₹1,621.30.
Of the 31 analysts tracking the stock, 30 have a ‘buy’ or ‘outperform’ rating while one has a ‘hold’ rating. On aggregate, these analysts expect the stock price to hit ₹1,904.6, which translates into a 20.1% upside potential from the current levels, showed a Bloomberg poll of analysts.
Nomura said the stock is attractively valued when compared with its key metrics and medium-to-long-term growth potential. The stock trades at 3.3 times its one-year forward book value vis-a-vis its 10-year average of four times, the brokerage said.
values the stock at 3.1 times and said the current valuation does little justice to its compounding potential and low balance-sheet risk. The stock remains its top pick in the banking sector, it said.
However, HSBC remained concerned and marginally trimmed its price target. The brokerage observed the bank is walking a tightrope forcing it into some trade-offs.
“Its incremental deposit market share is very strong. However, this is leading to a sequential drop in LDRs, which, along with a softer CASA ratio and a high fixed-rate loan book, may probably have led to peak NIMs (net interest margins) in 3QFY23,” said HSBC in a client note.
