PSU Stock To Buy: Rs.16.10/Share Dividend Declared; Are You Eligible?

Canara Bank, a public sector lender, released its financial results for the quarter and year that ended on March 31, 2024, on Wednesday. The bank's net profit climbed to 18.4%, and it also announced a 161% dividend for FY24. Following this announcement, the share price of the bank dropped by 3.25% to close at Rs 558.10 per share.

Canara Bank Dividend

The Board of Directors "Recommended Dividend of Rs.16.10/- per equity share (i.e., 161%) of face value of Rs.10/- each to the shareholders for the year 2023-24, subject to the approval of Shareholders at the ensuing Annual General Meeting of the Bank," said the PSU lender in a stock exchange filing today.

Monday, June 17, 2024, will be the record date for dividend payment. The payment of the dividend is subject to the approval of the shareholders at the bank's upcoming annual general meeting, which is set for Friday, June 28, 2024.

Canara Bank Q4 Results

For the quarter that ended in March 2024, Canara Bank reported a rise of 18 per cent in its standalone net profit of Rs 3,757 crore which was Rs 3,174 crore during the same period of FY23. For the reporting quarter, net interest income (NII) rose 11% year on year (YoY) to Rs 9,580 crore. During the period under review, the bank's net interest margin rose 10 basis points to 3.05%, while its return on equity improved by 257 basis points to 22.06%. According to Canara Bank, the Net Non-Performing Assets (NNPA) ratio dropped to 1.27% as of March 2024 from 1.32% as of December 2023 and 1.73% as of March 2023. As of March 2024, the Gross Non-Performing Assets (GNPA) ratio was 4.23%, down from 4.39% in December 2023 and 5.35% in March 2023.

Canara Bank Share Price Target

"Canara Bank Ltd. is an Indian public sector banking company, focused on segments like treasury operations, retail banking operations, wholesale banking operations, and other crucial banking operations. The large-cap company recently came into the news following its announcement to release earnings on May 8th, 2024, and a share split on the ex-date of May 15th, 2024. Notably, in a year, the banking company has offered 84.15% returns and declared a dividend of 1.91% on its 1,14,036 shares. Interestingly, its current PE ratio stands at just 8.08 against the sector ratio of 18.24, suggesting that the stock is currently undervalued. While this might interest some individuals, the stock is looking weaker and may undergo a correction of up to Rs. 490/440 from its current price of Rs. 557. Hence, I would recommend short-term traders to avoid this one. However, those with a broader view may consider entering the buying range of Rs. 430-480 for a targeted price range of Rs. 490-650. I recommended a holding period ranging from 60 to 350 days for this stock while adhering to the stop loss of Rs. 350," said V.L.A. Ambala, a Research Analyst (SEBI Registered), Co-founder - Stock Market Today (SMT).

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.