Canara Bank can touch Rs 375-380: SP Tulsian

Canara Bank can touch Rs 375-380, says SP Tulsian, sptulsian.com.

Tulsian told CNBC-TV18, "Canara Bank's fifty-two week low was Rs 306. Since then it has improved or recovered by more than 5%. Now, it is ruling at close to Rs 322. But the kind of pessimism, which we have been seeing on the PSU banking stocks, especially Canara Bank, Bank of Baroda, State Bank of India (SBI), Punjab National Bank (PNB), they have been seeing some short covering. I am not saying that renewed buying interest seem to have returned in these stocks. That has not happened. But the top five-six banks have started seeing some kind of short covering. The stock has seen in the last three days about 5% rise because 52-week low was at Rs 306."
He further added, "If you go by the financial performance, because of the increase in the gross NPA by 25 bps and increase in net NPA by 20 bps for the quarter ending June, the stock has been continuously sliding. But that has been the case practically with all PSU banks, whether the larger PSU banks or the midsize PSU bank. Somewhere you have to find out the bottom, you have to take a conviction call that stock seems to have bottomed out."
"In this series, I am expecting Bank Nifty to perform well. I expect that Bank Nifty can move back to about 10,700 or so in this series, keeping a positive stance on the series as well."
"Considering EPS of close to about Rs 70 and book value of the stock will rise to Rs 525 by March 31, 2013, the share is ruling at a PE multiple of close to 4.6 and price 0.6 times. That looks cheapest amongst the banks like PNB, Bank of Baroda, Canara Bank and SBI. It looks to be the cheapest on price to book basis, may not be on price to earning because all are virtually ruling in the same PE multiple close to about 4.5-5.  But on a price to book, it is quite cheap."
"Positive stance on the Bank Nifty for this series makes this as a short-term buy also. But otherwise also as a portfolio stock, one can expect a price of Rs 375-380 in the next six months or so." Disclosure: I have no investment interest in the above stock.