5 public sector banks hit 52-week high

Andhra Bank, Canara Bank, Indian Bank, Oriental Bank and Vijaya Bank hit 52-week highs.

Shares of five public sector banks (PSBs), Andhra Bank, Canara Bank, Indian Bank, Oriental Bank of Commerce and Vijaya Bank hit their respective 52-week highs on the National Stock Exchange (NSE) in an otherwise weak market.

Punjab National Bank (PNB), Punjab & Sindh Bank, Union Bank of India, Corporation Bank, Bank of Maharashtra and Syndicate Bank gained anywhere between 3% and 5%, and were trading close to their 52-week highs.

At 11:43 am; the Nifty PSU Bank index, the second largest gainer after Nifty Metal Index, was up 1.2% as compared to 0.53% decline in the Nifty 50 index. The PSU bank index hit an intra-day high of 3,593.30, is 26.15 points away from its 52-week high of 3,619.45 touched on April 18, 2017.

Thus far in the ongoing week, the Nifty PSU Bank index was up 4.2% against 3.2% rise in Nifty Bank and 1.9% gain in the benchmark index.

ICICI Securities have an outperform view on banking sector as the brokerage firm expects a gradual recovery in overall economy and implementation of newer mechanism of faster resolution of stressed assets will pave the way for an improvement in asset quality for banks, going ahead.

Indian Bank, the largest gainer among the pack, has rallied 23% during the week, after the bank reported good set of numbers for the quarter ended March 31, 2017 (Q4FY17).

Indian Bank had reported 241% year on year (YoY) jump in net profit at Rs 319 crore in Q4FY17, led by a lower base owing to higher slippages in Q4FY16. Net interest income or NII growth was healthy at 22.1% YoY to Rs 1,385 crore.

“On a relative basis, Indian Bank has emerged as a strong performer with stronger CAR, healthy asset quality and better returns ratios. Consequently, the bank is commanding a premium compared to peers,” analysts at ICICI Securities said in result update.

“The management expects upgrade and recovery to outweigh fresh slippages, leading to a reduction in GNPA. With moderation in slippages and balance sheet growth, we expect GNPA ratio at 6.2% and NNPA ratio at 3.7% in FY19E,”added report.

The bank has shown strong performance driven by margin expansion and relatively lower slippages. Well maintained asset quality among PSBs, loan growth trajectory coupled with margin expansion paints a positive outlook for the bank, said analyst at Cholamandalam Securities.

Bank of Maharashtra has surged 7% to Rs 37 after the bank announced fund raising plan of up to 2,000 crore.

“The board of directors of the bank will meet on May 4, 2017 to consider the proposal of raising of equity capital through follow-on-public offer (FPO)/rights issue/qualified institutional placements (QIP) etc., upto Rs 2,000 crore at an appropriate time, subject to the necessary approvals,” Bank of Maharashtra said in a regulatory filing.

COMPANY	LATEST	1-WK BEFORE	GAIN(%)
INDIAN BANK	320.60	260.10	23.26
BANK OF INDIA	178.70	150.45	18.78
VIJAYA BANK	78.85	69.40	13.62
ANDHRA BANK	66.75	60.05	11.16
SYNDICATE BANK	79.10	72.20	9.56
UCO BANK	41.15	37.75	9.01
ORIENTAL BANK	166.65	153.40	8.64
CORP BANK	58.25	53.75	8.37
ALLAHABAD BANK	79.25	73.25	8.19
PUN. & SIND BANK	62.05	57.95	7.08
PNB	165.45	154.90	6.81
UNION BANK (I)	167.10	157.05	6.40
IDBI BANK	76.45	72.20	5.89
DENA BANK	41.05	38.80	5.80
CANARA BANK	339.75	323.10	5.15
BANK OF BARODA	183.80	175.20	4.91
BANK OF MAHA	35.45	33.85	4.73