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Buy Bandhan Bank; target of Rs 390: Emkay Global Financial

Emkay Global Financial is bullish on Bandhan Bank has recommended buy rating on the stock with a target price of Rs 390 in its research report dated July 16, 2021.

July 16, 2021 / 01:25 PM IST
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Emkay Global Financial's report on Bandhan Bank

Bandhan Bank's AUM grew at a lower-than-expected rate of 8% yoy (down 8% qoq) to Rs801bn. We believe that this could be primarily due to lower disbursements in the MFI and small business loan segment on account of Covid-led disruptions in Eastern India, which is still reeling under extended lockdowns. Ujjivan, a relatively close peer, has also reported 2% yoy/7% qoq decline in AUM, while the impact on growth was relatively moderate for Equitas SFB, with its AUM up 15% yoy/down 0.5% qoq on lower dependence on the MFI book.


Notwithstanding near-term asset-quality risk, we have a Buy rating (TP: Rs390) on the stock, given its strategy of diversifying asset portfolio away from MFI in terms of both products and geography, enviable liability profile, superior return ratios (RoA/RoE of 2.5-3.4%/17-25% over FY22-24E) and reasonable valuations (2.2x FY23E ABV/1.7x FY24E ABV).

For all recommendations report, click here

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

Broker Research
first published: Jul 16, 2021 01:25 pm

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