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Top Brokerage Firms Initiate Buy On 2 Banking Stocks Including 1 Penny Stock For Gains Up To 48%

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Leading brokerage firms KR Choksey and ICICI Securities have initiated "Buy" on two private-sector banking stocks. These two private sector banks are South Indian Bank and Axis Bank. The brokerage claims return up to 48% if stocks are purchased at the current market price today. Here are the key details of the stocks:

 

Axis Bank
 

Axis Bank

KR Choksey has recommended investors to buy the stock of Axis Bank with a target price of Rs 1,210 apiece.  The stock is likely to fetch 42% return if purchased at the current market price. The current market price of the stock on NSE is Rs 856.40 apiece, trading 1.99% down from the previous close.

The stock's 52-week high is Rs 970 apiece and the 52-week low is Rs 618.25 apiece, respectively. The bank has a market capitalisation of Rs 2,63,708 crore. It is a large-cap banking stock. 

The stock has fallen 8.12% in 1 week, 8.22% in 1 month and 5.1% in 3 months, respectively. It gave 1.206% in 1 year, 17.25% in 3 years and 44.33% in 5 years, respectively.
 
KR Choksey said, "We expect ROE/ ROA to reach 16.7%/ 1.9% by FY25E from 12.0%/ 1.2%, respectively in FY22, led by consistent performance. We have factored CAGR of 15.3% in advances, 19.5% in NII, 22.8% in PPOP, and 31.2% in PAT over FY22-25E, driven by strong trends in business momentum & improving operating performance. We roll over our target price to FY25E Adj. Book Value. We revise our target price to INR 1,210 per share (earlier INR 1,120), applying 2.0x P/ABV multiple to an adjusted book value of INR 605.7 per share. This implies an upside of 35.7% over the CMP. We maintain our rating on the share of AXSB at "BUY"."

South Indian Bank

South Indian Bank

ICICI Securities has assigned "buy" on the stock of South Indian Bank with a target price of Rs 25 apiece. If stock is purchased now at the current market price it could fetch 48% return. The current market price of the stock is Rs 17 apiece, trading 0.89% up from its previous close. 
 
 The 52-week high of the stock is Rs 21.80 apiece and the 52-week low is Rs 7.25 apiece, respectively. It is a penny stock with a market capitalisation of Rs 3,547.20 crore.

The stock declined 6.34% in the last 1 week, and 9.57% in the last 1 month, respectively. Whereas, it gained 27.82% in the last 3 months. It gained 93.18% in the last 1 year, and 59.62% in the last 3 years. It declined 44.17% in the last 5 years.
 
According to ICICI Securities, "With improving credit outlook, management estimates double-digit credit growth in FY23 with focus on scaling up the retail segment. Improved PCR at 60%, SMA-2 at 1% (new book: 0.2%) and steady decline in slippage ratio to 2% in Q3FY23 (vs 2.9% in Q1FY23) suggest that credit cost is likely to sustain at current levels. Overall, we expect RoA to reach 0.80% in FY24E. Maintain BUY with a revised target price of Rs25 (earlier: Rs14), as we now value the stock at 1x Sep'23E BVPS vs 0.5x earlier."

Disclaimer

Disclaimer

The stocks have been picked from the brokerage reports. 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.

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