Buy Bank of Baroda; target of Rs 240: Motilal Oswal

Motilal Oswal is bullish on Bank of Baroda recommended buy rating on the stock with a target price of Rs 240 in its research report dated November 05, 2023.

Broker Research

November 07, 2023 / 13:17 IST

Buy

26 Aug, 2025 12:21

Volume

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Motilal Oswal's research report on Bank of Baroda

Bank of Baroda (BOB) reported a mixed quarter as PPoP grew 33% YoY (13% beat) aided by higher other income (49% beat) though margins declined 20bp QoQ to 3.07%. Business growth was healthy, with loan growth of 19% YoY (4% QoQ) and deposits growth of 15% YoY (4% QoQ). Loan growth was led by healthy growth in retail segments. CASA ratio moderated 45bp QoQ to 39.9%. Asset quality improved despite high slippages at INR47.5b (led by aviation account). GNPA/NNPA ratios yet improved to 3.32%/0.76%, while PCR moderated 88bp QoQ. SMA 1/2 was under control at 22bp of loans.

Outlook

Asset quality continued to improve with NNPA at 0.76%, while lower SMA book provides further comfort on asset quality. We maintain our earnings estimates and expect FY25E RoA/RoE of 1.2%/16.8%. We value the stock at INR240 (1.1x FY25E ABV) and reiterate our BUY rating.

For all recommendations report, click here