Macquarie has outperform rating on Bandhan Bank, target price Rs 350

Macquarie has upgraded Bandhan Bank to outperform from underperform but cut target price by 26 per cent to Rs 350. Shares of Bandhan Bank ended down 8 per cent at Rs 161 on Tuesday while the BSE Sensex closed 692.79 points up (+2.67 per cent) at 26,674.03.

Bandhan Bank Ltd., incorporated in 2014, has a market cap of Rs 25924.99 crore.

Investment Rationale


The brokerage said 56 per cent correction in Bandhan Bank shares in March makes riskreward lucrative. The brokerage has cut FY21-FY22 EPS estimates by 12-15 per cent.

Financials

Bandhan Bank's key products/revenue segments include Interest & Discount on Advances & Bills which contributed Rs 5727.23 crore to sales value (86.20 per cent of total sales); Income From Investment which contributed Rs 617.12 crore to sales value (9.28 per cent of total sales) and Interest which contributed Rs 228.28 crore to sales value (3.43 per cent of total sales) for the year ending March 31, 2019.

The bank reported Gross Non Performing Assets (Gross NPAs) of Rs 1181.96 crore and Net Non Performing Assets (Net NPAs) of Rs 491.44 crore.