PNB share price jumps after strong Q2 results 2024. More steam left?

Stocks to buy after Q2 results 2024: On Monday, Punjab National Bank (PNB) reported a standalone net profit of ₹4,303.5 crore in the quarter ended September 2024, recording a substantial growth of 145% from ₹1,756 crore in the year-ago quarter. After these robust second-quarter numbers for the current financial year, PNB share price witnessed strong buying on Monday, which also continued during the early morning session on Tuesday. PNB share price today opened with an upside gap and touched an intraday high of ₹102.61 apiece on the NSE, recording an intraday high of over 4 per cent. In the last two sessions, post-Q2 results 2024, PNB share price has risen from ₹95.78 to ₹102.61 apiece, logging more than a 7 per cent rise.

According to stock market experts, PNB reported strong Q2 results 2024, reporting improved asset quality and CASA ratio. They said that Bank PSU's cost of funding also went down during the September 2024 quarter, helping the state-owned bank increase interest income during the July to September 2024 quarter. They said the PNB share price may touch ₹120 soon and advised buy-on-dips for fresh investors.

PNB Q2 results 2024 review

Speaking on PNB Q2 results 2024, Mahesh M Ojha, AVP — Research at Hensex Securities, said, “Punjab National Bank (PNB) reported 2QFY25 results with a slight variation in NII and PPOP at (-)1.8% and (-)3.4%, respectively. PAT was 22% better than expected due to higher non-interest income and lower credit costs for the quarter.• Net advance growth was strong at 3.6% QoQ/~15% YoY. The deposit mobilisation pace was also strong at 3.6% QoQ/~11% YoY, mainly led by term deposits, and the CASA ratio declined to 38.2% (from 39% QoQ).• LDR remained stable QoQ at ~70%. Reported global margins contracted by 15 bps QoQ to 292 bps, while calculated NIMs (on QABs) went down by nine bps QoQ to 269 bps.• On the asset quality front, gross slippages increased, though net delinquencies went down and turned negative to (-)34 bps.”

On critical takeaways from PNB Q2FY25 results, Anshul Jain, Head of Research at Lakshmishree Investment and Securities, said, "PNB reported an impressive 145% year-on-year (Y-o-Y) surge in net profit for the second quarter (Q2) of FY2024-25, reaching ₹4,303 crore, a substantial rise from ₹1,756 crore in the same period last year. The bank's net interest income (NII) steadily increased by 5.99% Y-o-Y, totalling ₹10,517 crore. PNB's asset quality improved significantly, with the gross non-performing asset (GNPA) ratio declining by 248 basis points to 4.48%, down from 6.96% a year ago. Meanwhile, the net NPA ratio dropped to 0.46%, showcasing better risk management."

"Retail credit growth stood out, with an overall 14.6% Y-o-Y rise to ₹2.5 trillion, led by a 19.5% increase in housing loans and a 25% jump in vehicle loans. RAM (Retail, Agriculture, MSME) advances grew 12.03% Y-o-Y, reaching ₹5.64 trillion. The bank's CASA deposits rose 3.4% Y-o-Y, amounting to ₹5.56 trillion," Anshul Jain added.

PNB share price target

Expecting more upside in PNB share price, Sumeet Bagadia, Executive Director at Choice Broking, said, “PNB share price has a strong base at ₹90. So, PNB shareholders can hold the scrip, maintaining a strict stop loss at ₹90 for the near-term target of ₹120.”

On the suggestion to fresh investors, Sumeet Bagadia said, “Fresh investors can buy PNB shares at the current market price and maintain a buy-on-dips strategy until the PSU stock is above ₹90 apiece. They are advised to maintain a stop loss at ₹90 for the short-term target of ₹120 per share.”

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.