ICICI Direct is bullish on Bank of Baroda has recommended buy rating on the stock with a target price of Rs 130 in its research report dated November 11, 2019.
ICICI Direct's research report on Bank of Baroda
Bank of Baroda (BoB) reported a mixed set of numbers. Credit growth continued to remain subdued at 3% YoY to | 637340 crore due to ongoing merger integration process. Corporate & MSME book witnessed de-growth of 1% & 6% YoY, respectively, while retail growth came in healthy at 16.2% YoY. Within retail, home & auto loan continue to grow at a healthy pace of 13% & 33% YoY, respectively. Further, deposit growth also slowed in accordance with slothful credit growth to 2% YoY to | 8.94 lakh crore. The bank has shed high cost bulk deposit, which resulted in CASA (domestic) growth of 133 bps QoQ to 37.88% & margin improvement.
Given the recent capital infusion at lower valuation, we lower our ABV estimates valuing the stock at 1.1x FY21E ABV. We maintain our BUY rating on the stock.
For all recommendations report, click here
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