The Indian banking sector, comprising 12 public sector banks, 22 private sector banks, and 46 foreign banks, serves over 200 million customers. With total assets exceeding USD 2 trillion and a credit growth rate of 18%, it plays a pivotal role in the nation’s economic development and financial inclusion.
Here are the bank stocks with an upside potential of up to 30%;
CSB Bank Ltd
CSB Bank Ltd operates through four segments: small and medium enterprises (SME) banking, retail banking, wholesale banking, and treasury operations. It offers various products and services, including personal banking, non-resident Indian (NRI) banking, and others.
With a market capitalization of Rs 5,773.61 crore, the shares were trading at Rs 332.80 per share, increasing around 1.46 percent as compared to the previous closing price of Rs 328.00 apiece.
Nuvama, one of the well-known brokerages in India, gave a ‘Buy’ call on the bank stock with a target price of Rs 430 apiece, indicating a potential upside of 30 percent from Thursday’s price of Rs 332.80 per share.
As per the brokerage, advances grew moderately with a 6% QoQ increase in gold loans and 18% in the SME portfolio. The SME book, post-rejig, is projected to grow 35% in FY25. Despite challenges, management expects NIM to stabilize at 4.5–4.8% in FY25 and anticipates a moderated C/I ratio from Q2FY25.
Looking into the company’s financial performance, revenue magnified by 21 percent from Rs 683 crore in Q1FY24 to Rs 832 crore in Q1FY25, and during the same time frame, net profit shrunk by 14 percent from Rs 132 crore and Rs 113 crore.
IndusInd Bank Limited is publicly held and provides a comprehensive variety of banking products and financial services to corporate and retail clients alongside executing treasury operations. The Bank operates in India including at the International Financial Service Centres.
With a market capitalization of Rs 1.12 lakh crore, the shares were trading at Rs 1,439.80 per share, increasing around 0.82 percent as compared to the previous closing price of Rs 1,428.15 apiece.
ICICI Direct, one of the well-known brokerages in India, gave a ‘Buy’ call on the bank stock with a target price of Rs 1,800 apiece, indicating a potential upside of 25 percent from Thursday’s price of Rs 1,438.15 per share.
As per the brokerage, despite challenges, the bank reported 15% YoY growth in advances, driven by a 19% YoY rise in the retail segment. Moreover, the brokerage also added that management is confident, projecting 18-22% credit growth in FY25E and an 18% CAGR in advances for FY25-26E. Steady margins at 4.25% and robust asset quality will support RoA at 1.7-1.8%.
Looking into the company’s financial performance, revenue magnified by 17 percent from Rs 10,730 crore in Q1FY24 to Rs 12,547 crore in Q1FY25, and during the same time frame, net profit shrunk by 1.3 percent from Rs 2,124 crore and Rs 2,152 crore.
Written by:- Abhishek Singh
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