In the last trading session i.e. on Friday (June 18, 2021) while the headline indices ended on a flat note, PSU Banking pack saw the most drag of 1.77 percent. Nonetheless, brokerages are bullish on the pack for a number of reasons including privatization and also believe that as these PSBs are low on lending to retail segment, they will not suffer a huge blow due to the Covid 19 pandemic.
ICICI Direct has given a 'Buy' recommendation on the scrip of Bank of Baroda for a target price of Rs. 102, i.e. an upside of 20 percent from the recommended buy price of Rs. 85 Last the scrip of the PSU lender closed at Rs. 80.2 per share on the NSE.
For the scrip, the brokerage firm ICICI Direct said, "Bank of Baroda is one such stock, which seems to be moving out of the current consolidation and is likely to make 52 weeks highs in coming weeks. In PSU banking, SBI has been one of the best performers in the last one year but Bank of Baroda has been an underperformer. The stock has seen a gradual build-up of open interest in the last couple of months with the recent price performance. However, there is ample room for further increase in price. We expect further long additions in the stock once it sustains above Rs. 85 levels."
"The stock witnessed noteworthy delivery volume activity in January and May. Fresh delivery based buying was seen around Rs. 70-76. Hence, any declines in the stock can be utilised as a fresh buying opportunity. The stock made a 52-week high near Rs. 100 in February 2021. Since then, it has corrected towards its medium term support of Rs. 64 levels. Currently, it has been largely range bound hovering around Rs. 78 and Rs. 86. It failed to sustain above Rs. 85 despite many attempts in the past trading sessions. However, recently, the stock has taken support at lower band level of Rs. 78 and is now witnessing fresh buying momentum", added the brokerage.