Accumulate Syndicate Bank; target Rs 99: Angel Broking

15526 Investors following Syndicate Bank. Share this News with them.

0

Like this story, share it with millions of investors on M3

Accumulate Syndicate Bank; target Rs 99: Angel Broking

Angel Broking is bullish on Syndicate Bank and has recommended accumulate rating on the stock with a target price of Rs 99 in its January 20, 2012 research report.

Post your opinion here

 

0

Tweet

Share on Tumblr

RELATED NEWS Sell HDFC Bank; target Rs 471: Dolat Capital Buy TCS; target of Rs 1165: FIFL 10 stocks you should keep an eye on post Q3 results: Emkay ALSO READ See previous views by Angel Broking See what other Experts & Brokerages are saying about Syndicate Bank See messages about Syndicate Bank Syndicate Bank BSE | NSE 30/05/12 Are Mutual Funds betting on Syndicate Bank?

Angel Broking is bullish on Syndicate Bank and has recommended accumulate rating on the stock with a target price of Rs 99 in its January 20, 2012 research report.

"For 3QFY2012, Syndicate Bank reported 32% yoy growth in its net profit to Rs 338cr, ahead of our estimates, primarily on account of lower-than-estimated effective tax rate. On the PBT front, results were ~18% below our estimates due to higher-than-expected provisioning expenses. Muted business growth while maintaining NIMs and stabilization of asset-quality pressures was the key highlight of the results."

"During the quarter, business growth for the bank moderated a bit. The bank's advances grew by muted 2.0% qoq (up 14.9% yoy) and deposits increased by muted 1.4% qoq (up 14.9% yoy). CASA deposits growth remained sluggish at 6.6% yoy (just 2.2% qoq), leading to a 237bp yoy dip in CASA ratio to 30.8%. However, on a sequential basis, CASA ratio improved albeit marginally by 22bp to 30.8% on the back of a 5% qoq increase in current account deposits. The 22bp qoq rise in cost of deposits was largely offset by almost similar increase in yield on advances, leading to sequentially stable NIM for the quarter at 3.45%. On the asset-quality front, pressures for the bank subsided with slippages declining to Rs 550cr (1.9%) from the elevated Rs 971cr (3.6%) witnessed in 2QFY2012. The bank had strong upgradations (of ~Rs 350cr), which aided in registering a sequential decline in gross and net NPAs on an absolute basis. Provision coverage ratio, including technical write-offs, remained healthy at 78.5%."

"The stock is currently trading (at 0.6x FY2013E ABV) near its five-year range of 0.7-1.3x and median of 0.9x. Keeping in mind the bank's stable asset quality, moderate growth strategy over the past couple of years and moderate NIM, the valuation appears cheap relative to its peers (which are trading at higher multiples, although they have similar or poorer fundamentals). We value the stock at 0.7x FY2013E ABV and recommend an Accumulate rating with a target price of Rs 99," says Angel Broking research report.

See which stocks FIIs have sold in last qaurter?

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

To read the full report click on the attachment