Buy RBL Bank, target price Rs 273: LKP Securities

LKP Securities has buy call on RBL Bank with a target price of Rs 273. The current market price of RBL Bank Ltd. is Rs 215.

Time period given by analyst is one year when RBL Bank Ltd. price can reach defined target.

RBL Bank Ltd., incorporated in the year 1943, is a banking company (having a market cap of Rs 12863.00 Crore).


Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 2704.90 Crore, up 2.61 % from last quarter Total Income of Rs 2636.20 Crore and down -2.80 % from last year same quarter Total Income of Rs 2782.77 Crore. The bank reported net profit after tax of Rs 75.74 Crore in latest quarter.

Investment Rationale
RBL Bank holds a healthy positioning as demonstrated by 1) Extension of CEO, Mr. Vishwavir Ahuja, tenure 2) adequate covid provisioning, 3) improved PCR, and 4) healthy liquidity position with LCR of 156%. Furthermore, a healthy capital position (CET 1: 17.1%) post fund raise would provide cushion. Thus, the brokerage recommends a BUY rating on the bank with revised target price of ₹273 (based on 1.2xFY23 Adjusted Book Value).

Promoter/FII Holdings
Promoters held 0 per cent stake in the company as of Dec 30, 2020, while FIIs held 35.2 per cent, DIIs 24.7 per cent and public and others 40.2 per cent.