Private Sector Banking Stock Showing Upside Potential, Brokerage Initiates Buy, Sees 25% Return

Keynote Capital, a leading brokerage firm, has come up with a "buy" recommendation on Federal Bank Ltd. (FBL). The brokerage assigns a target price of Rs 164/share on the stock for gains of up to 25%. FDL is a leading midcap private sector banking with a market capitalisation of Rs 27,954.62 crore.

Stock Outlook & Performance Over The Years

The stock's current market price is Rs 131.95/share, up 0.23% from the previous close. Today, it opened at Rs 131.15/share. Its 52 week low is Rs 82.50/share and 52 week high is Rs 143.40/share, respectively. The stock has given 3.54% positive return in the past 1 week, and 2.61% in the past 1 month, respectively. It has given 36.81% positive return in the past 1 year. In the past 3 years, it has given the highest 186.41% positive return. In the past 5 years, it has given 34.17% positive return.

Empowering Progress: Fueling Growth through Digital Partnerships

Keynote Securities said, "We initiate coverage on Federal Bank with a BUY rating and a target price of Rs. 164 (1.5x FY24 Adj. Book Value). We believe that FBL is set to grow its loan book at 18- 20% with stable NIM of 3.35%. Improvement in the cost-to-income ratio and provision will lead to the normalization of asset quality. All these factors will improve profitability growth, leading to improved return ratios."

About - Federal Bank

Established in 1931 as 'Travancore Federal Bank', the Bank was renamed 'Federal Bank Limited (FBL)' in 1949 and became a scheduled commercial Bank in 1970. Over the years, the Bank grew steadily and expanded its operations beyond Kerala to other parts of India. FBL is evolving into a more prolific franchise driven by its impressive balance sheet size, quality growth trajectory, extensive pan-India presence, unique branch light distribution heavy model, and strategic digital/fintech partnerships.

Disclaimer - The stock has been picked from the brokerage report of Keynote Capitals. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.