22575 Investors following Bank of India. Share this News with them.
0
Like this story, share it with millions of investors on M3
Sell Bank of India; target of Rs 299: Dolat Capital
Dolat Capital is bearish on Bank of India and has recommended sell rating on the stock with a target of Rs 299 in its January 30, 2012 research report.
Dolat Capital is bearish on Bank of India and has recommended sell rating on the stock with a target of Rs 299 in its January 30, 2012 research report.
"Bank of India's (BoI) NII grew 4% YoY to Rs 20.7bn - 3% higher than our estimates of Rs 20.1bn. BoI's non-interest income growth of 31.5% YoY to Rs 8.5bn aided operating profit, which grew 24.7% YoY to Rs 17bn (Dolat est: Rs 14.7bn). Net profit grew by 9.6% YoY to Rs 7.2bn (Dolat est: Rs 6.1bn, Bloom consensus est: Rs 6bn) mainly due to higher other income and lesser than expected bad-debts provisioning. The deviation at the operating profit level was due to higher cash recoveries of Rs 1.9bn as compared to Rs 658mn in Q3 FY11 and Rs 876mn in Q2 FY12."
"BoI's asset quality improved on sequential basis, with a 2% QoQ decline in gross NPA to Rs 63.9bn. The gross slippage ratio declined sharply to 0.98% as against 5.62% in Q2FY12. On restructuring front, the bank added Rs 26bn of fresh loans (including Rs 22bn in domestic markets). On restructured loan book, the bank reported NPV losses of Rs 1.2bn. Considering sequential improvement in asset quality and margin, we revise our FY12 and FY13 earnings estimates by 18% and 26% respectively. We raise our target price by 20% to Rs 299 and reiterate our SELL rating at 1.1x adjusted book value (ABV) FY13. Build-up in restructured loan book, NPA losses and slippages therein remain key concerns," says Dolat Capital research report.
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.
