Bandhan Bank Shares Hit 52-Week High as Strong Results Signal Turnaround

Mumbai, April 29:Shares of Bandhan Bank surged on Wednesday, hitting a 52-week high after the lender reported a strong set of March quarter earnings, with improving asset quality and significantly lower provisioning signalling a sharp turnaround.

The stock jumped as much as 14% at Rs 204, extending recent gains, as investors cheered the sharp rebound in profitability.

At the time of writing, the stock was up 12 percent at Rs 201.

Stock was up after a sharp rebound in March quarter performance. Source: NSE 

Strong Show

The lender reported a 68% year-on-year jump in net profit to around ₹530 crore, aided largely by a steep decline in provisions and a steady improvement in its loan book quality.

Asset quality trends were particularly encouraging. Gross NPAs eased sequentially to about 3.3%, while net NPAs also saw a marginal decline, reflecting better recoveries and lower stress in the microfinance portfolio—a segment that had weighed on the bank’s performance in recentquarters.

Provisions fell sharply down over 40% both sequentially and on a yearly basis signalling that the worst of the asset quality stress may be behind the lender. This easing of credit costs played a key role in boosting profitability during the quarter.

Muted Topline

However, the topline performance remained relatively muted. Net interest income (NII) grew only marginally, indicating that while the bank is stabilising on the asset quality front, growth momentum is still evolving.

Brokerages have largely taken comfort from the improving fundamentals, with several firms raising target prices following the results. Analysts highlighted moderation in slippages, improving early stress indicators, and a gradual normalisation of the microfinance business as key positives.

The sharp post-results rally also reflects a broader re-rating, with the stock having gained significantly over the past month amid renewed optimism around earnings recovery and balance sheet repair.

That said, some caution persists. While asset quality has improved, analysts note that sustained growth in the loan book and consistent margin expansion will be critical for the next leg of the rally. The microfinance segment, which remains a core part of Bandhan Bank’s portfolio, will continue to be closely watched for signs of stability.

Bottom line:

Bandhan Bank’s Q4 print signals a meaningful turnaround driven by lower credit costs and improving asset quality. The Street has responded with upgraded targets and renewed optimism, but the sustainability of this rally will hinge on whether the bank can now translate balance sheet repair into consistent growth.

Source:

• https://www.nseindia.com/get-quote/equity/BANDHANBNK/Bandhan-Bank-Limited