 "RBL Bank share price drops 11% in 5 days; what's weighing on stock?")
RBL Bank share price: RBL Bank share price extended its weakness into a fifth session. The stock declined 5.5 per cent to Rs 155.15 per share in intraday trade today, taking the five-day losing streak to 10.5 per cent.
By comparison, the benchmark BSE Sensex today was volatile, swinging between 78,674 and 79,587 levels. In the past five sessions, including Friday’s, the 30-stock index has slipped 4.2 per cent.
The stock exited F&O bank list today, December 20, 2024. Notably, a security enters F&O ban list when open interest of a security total exceeds 95 per cent of the market-wide position limit.
Meanwhile, reports suggest global brokerage Morgan Stanley has cut RBL Bank’s share price target to Rs 160 from Rs 180 amid higher credit costs and weak margins.
The brokerage, reportedly, has reduced the private bank’s earnings estimate by 1 per cent for financial year 2024-25 (FY25), 9 per cent for FY26, and 2 per cent for FY27.
“The downward revisions reflect asset quality challenges in RBL Bank’s credit card and micro-lending portfolios. Sustainable Return on Equity assumptions are also cut to 9.5 per cent (from 10 per cent) in base case scenario, 6.3 per cent from 7.5 per cent in bear case, and 14.5 per cent from 15 per cent in bull case,” Morgan Stanley noted.
In the July-September quarter (Q2) of the current financial year, RBL Bank reported a 24 per cent year-on-year (Y-o-Y) decline in net profit at Rs 223 crore.
Also Read
Its net interest income (NII) grew 9 per cent Y-o-Y to Rs 1,615 crore, but net interest margin (NIM) fell to 5.04 per cent from 5.54 per cent a year ago and from 5.67 per cent in the June quarter.
The cost of funds (CoF) rose to 5.59 per cent, as against 4.92 per cent in the year-ago period.
Asset quality of the lender weakened as the gross non-performing asset (NPA) ratio inched up to 2.88 per cent as on September 30, 2024, compared to 2.69 per cent as on June 30, 2024.
The net NPA ratio stood at 0.79 per cent as on September 30, 2024, compared to 0.74 per cent as on June 30, 2024. Provisions, too, rose to Rs 618 crore due to higher slippages in credit cards and microfinance.
R Subramaniakumar reappointed as RBL Bank MD and CEO
Meanwhile, RBL Bank, in a stock exchange filing on December 16, 2024, informed the stock exchanges that Committee of the Board, the Board of Directors, has approved the re-appointment of R Subramaniakumar as the Managing Director & CEO of the Bank for a period of three years, with effect from June 23, 2025 up to June 22, 2028, subject to the approval of the Reserve Bank of India (RBI) and the shareholders of the Bank.
About RBL Bank
RBL Bank, a private sector bank, is engaged in providing a wide range of banking and financial services, including wholesale banking, retail banking treasury operations and other banking related activities.
RBL Bank stock hit an all-time high of Rs 716.55 per share on May 28, 2019. It touched a 52-week high of Rs 300.5 per share on January 11, 2024 and a 52-week low of Rs 147.5 per share on December 2, 2024.
The stock has a price-to-earnings (P/E) multiple of 8.06-times. RBL Bank market-cap is Rs 9,584.3 crore as of 12:05 PM today.