Bank of Baroda shares fall 5% as brokerages cut target price on Q3 miss

Bank of Baroda shares fell up to 5% on Friday to Rs 211.90 on BSE after brokerages slashed target prices of the PSU lender after its Q3 net interest income (NII) missed consensus estimates and declined 2% sequentially led by a fall in NIM (net interest margins).

Global brokerage firms Jefferies and HSBC reduced the target price to Rs 250 per share. Jefferies said the Q3 profit figure was ahead of estimates due to lower provisions.

Nuvama analysts said while NII missed estimates, non-interest income and credit cost beat expectations, leading to a 7% beat on PAT—up 6% YoY, but down 8% QoQ.


"Our new target price of Rs 265 is based on ~1x BV FY26E (earlier Rs 277). BoB has underperformed PSU Bank Nifty by 3%

over the last one month. Given its RoA of 1%+ and cheap valuation of 0.8x BV FY26E, we retain ‘BUY’," Nuvama said.

Also read | Treasury gains take BoB Q3 profit up 6%

During the quarter, BoB's net profit increased 6% year-on-year to ₹4,837 crore in the quarter ended December 2024 from ₹4,579 crore a year ago mainly due to strong rise in non-interest income despite slow loan growth and fall in margins.

BoB CEO Debadatta Chand said the bank expects to end the current fiscal year with a NIM of between 3% and 3.10%, lower than the 3.10-3.20% estimate at the beginning of the year, but better than the third quarter largely as deposits are likely to be repriced at a lower rate.

"We are mindful of our credit-to-deposit ratio of 84% which is near the peak of our expectations but with deposits expected to grow 9-11% and advances growth seen at 11-13% we expect to be closer to 80%," Chand said.

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