PNB shares jump 5% ahead of Q3 numbers

NEW DELHI: Shares of Punjab National Bank jumped nearly 5 per cent in Tuesday's session ahead of its December quarter earnings.

The stock traded in the green zone despite many brokerages expecting the bank's number to be subdued.

Brokerage Kotak Institutional Equities is expecting the bank to report losses for the third quarter.


"We expect losses, albeit lower versus the large loss figure in 2QFY19, due to the reversal in MTM provisions and a decline in credit costs. Gross NPLs will decline on the back of higher recoveries from NCLT cases as well as write-offs due to the ageing of NPLs," the brokerage said.

We expect loan growth of 4 per cent YoY and NIM to be stable QoQ at 2.4 per cent, it added.

The public-sector lender is likely to report a flattish net interest income (NII) and loan growth, whereas margins may improve by nearly 2.75 per cent due to lower interest reversals, as per the brokerage Motilal Oswal Securities.

"Stress addition is likely to moderate but still remain elevated at 4.3 per cent annualized, said the brokerage.

Outlook on asset quality, as net stressed loans remain one of the highest in the industry, progress on the fraud account and its impact and the performance of CASA and net interest margins (NIMs) are the important things market will keenly observe in PNB's earnings.

Shares of the company traded 3.96 per cent up at Rs 76.05 around 10:20 am on BSE.