Punjab National Bank share prices rises 7% post Q1 results: Should you Buy, Sell or Hold the stock ?

Stock Market Today: Punjab National Bank (PNB)share price gained more than 7% in the morning trades on Monday post Q1 results, that were declared over the week end.

Punjab National Bank (PNB)share price opened at ₹124.86, almost 4% higher than previous close of ₹119.95 on the NSE on monday. PNB share price thereafter continued to gain to intraday highs of ₹128.66, marking gains of more than 6%.

The Punjab National Bank (PNB) reported highest-ever quarterly standalone profit of ₹3,252 crore, bolstered by an increase in interest revenue and a decrease of bad loans. The net profit rose 159 per cent year on year.

The difference between interest earned and paid, or the net interest income (NII), increased 10.2% to ₹10,476.2 crore in the first quarter of the current fiscal year from ₹9,504.3 crore in the same period last year.

Analysts at Jefferies India Pvt ltd who have a target price of ₹150 for the PNB stock indicating around 20% upside in their post results report said that Q1FY25 asset quality stayed strong. Jefferies expects the earnings Rebound to stay

For Q1FY25, though Punjab National Bank (PNB) net profit was tad below Jefferies estimates due to higher operating expenses (towards PSLCs (Priority sector lending certificates), these are unlikely to recur. PSLCs are certificates that are issued against priority sector loans for banks .

Key positive as per Jefferies remained lower slippages at 0.8% which though were offset by higher recoveries. Moreover, with coverage at 88% already, Jefferies sees credit costs staying low for 1-2yrs. They see ROA (Return on Assets) at 0.9% in FY26 with potential fall in tax rate boosting ROA. Valuation at 1.1 times adjusted price to Book values based on FY25 estimates of Jefferies is also reasonable and they rate the Punjab National Bank (PNB) share price as Buy with target of Rs150.

Motilal Oswal Financial Services post Q1 results have raised their Earnings per share estimates by 5.6% and 0.8% for FY25 and FY26 respectively, factoring in lower provisions, healthy Net interest income, and steady margins. They estimate an RoA (Return on Asset) and RoE (Return on Equity) of 1.0% and 14.5% in FY26. Target price for Punjab National Bank (PNB) share price as per MOFSL stands at ₹135.

Kotak Institutional Equities in their post results report on Punjab National Bank (PNB) said that Asset quality is comfortable; net NPL (Non Performing Loan) ratio touched 0.6%—at par with State Bank of India. Slippage ratio was at 0.8%. Bad loan recoveries held up well. Positive is that the Advances grew 12% year on year, led by retail and agriculture. However they feel valuation of Punjab National Bank Share price (PNB) is expensive their target price stands at ₹110.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions