Led by push in Nifty PSU Bank index stocks due to healthy inflation number, which happens to be top index gainer, the stock of PNB has scaled by as much as 4% on the NSE. This is the most increase in stock price in 4 month's time.
Other banks that also increased in the range of 1-4% include the likes of State Bank of India (SBI), Indian Bank, Bank of India, Union Bank of India, Syndicate Bank, Indian Overseas Bank and Canara Bank.
PNB hit a high of Rs. 85, the highest price since September 10, 2018. From a low of Rs. 58, the stock has bounced back by as much as 47 %.
"With inflation on a falling trajectory, and the cores of both headline and WPI inflation falling, there are chances market might expect the Reserve Bank of India (RBI) to cut rates in Feb'19. Considering the low IIP growth and the low GDP growth forecast by the government, the RBI may change its stance from "calibrated tightening" to "neutral", opening up the possibility of a rate cut in future," an economist at Anand Rathi Shares and Stock Brokers said in a note.
The rating agency CRISIL in December 2018 assigned a 'Stable' outlook on the long-term rating of PNB. And the credit rating judges the stock to perform strong on the back of government's continuing support as well as resource situation over the medium term.
And the agency can still revise its outlook to strong in case the slippages at the bank fall and profitability improves.
The stock last quoted at Rs. 84.2, up 2.75% on the NSE.