Hold Bandhan Bank; target of Rs 193: KR Choksey

KR Choksey recommended hold rating on Bandhan Bank with a target price of Rs 193 in its research report dated April 08, 2024.

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April 09, 2024 / 12:36 IST

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KR Choksey's research report on Bandhan Bank

Bandhan Bank Limited (BANDHAN)’s board has taken on record the letter submitted by Mr. Chandra Shekhar Ghosh, MD & CEO of Bandhan Bank, informing that he would retire from the services of the Bank as the MD & CEO upon completion of his current tenure on July 9, 2024. Mr. CS Ghosh founded Bandhan Bank and has been associated with it for over 24 years. Post-retirement as CEO, Ghosh will take up a “strategic role” at the group holding company level (i.e., Bandhan Financial Holdings Ltd), advising the group’s business verticals. Bandhan Bank has insurance and mutual fund subsidiaries under the holding company. Bandhan Financial Holdings Ltd. owns about 40.0% of Bandhan Bank. In November 2023, the board of directors recently approved Mr. CS Ghosh's threeyear re-appointment, which remains with the RBI for approval. The Bank's screening panel will require at least three months to decide on a new candidate for the positions of MD and CEO. The Reserve Bank of India (RBI) may need a few more months to determine it, as well. Until then, there will be an interim MD and CEO.

Outlook

We expect the new CEO's transition to take at least six months, during which we expect the stock to underperform. • Accordingly, we downgrade to HOLD from the earlier rating of ACCUMULATE on the shares of Bandhan Bank Ltd.

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