Buy Canara Bank; target of Rs 115: Motilal Oswal

Motilal Oswal is bullish on Canara Bank recommended buy rating on the stock with a target price of Rs 115 in its research report dated January 27, 2025.

Broker Research

January 28, 2025 / 12:06 IST

Buy

26 Aug, 2025 12:21

Volume

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Motilal Oswal's research report on Canara Bank

Canara Bank (CBK) reported 3QFY25 standalone PAT at INR41b (12.3% YoY growth, in line) because of higher other income, partly offset by lower NII and higher provisions. NII declined 2.9% YoY to INR91.5b (5% miss). NIM moderated 15bp QoQ to 2.71% during the quarter. The loan book grew 11.2% YoY/4% QoQ to INR10.2t, while deposit growth was modest at 8.4% YoY/1.6% QoQ to INR13.7t. CASA ratio moderated to ~30% in 3QFY25. Management guided 10% credit growth for FY25. On the asset quality front, total slippages stood at INR24.6b (INR23.5b in 2QFY25). Healthy recovery and write-offs led to 39bp/10bp QoQ improvement in GNPA/NNPA to 3.34%/0.89%. PCR was stable at 74.1%.

Outlook

We broadly maintain our projections and estimate CBK to deliver FY26E RoA/ RoE of 1%/17.7%. We reiterate our BUY rating with a TP of INR115 (premised on 0.9x Sep’26E ABV).

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