Anand Rathi's research report on Karnataka Bank
A steep rise in margins and negative provisions led to Karnataka Bank’s Q2 strong profitability, with its RoA at 1.7%. With most pandemicrelated stress already recognised/re-structured, the focus now shifts toward growth. Key positives were 1) strong traction in retail loans, 2) moderation of slippages and 3) strong margin improvement. With credit growth picking up and moderating credit costs, earnings are expected to normalise in the medium term.
Outlook
We upgrade our rating to a Buy, with a higher TP of Rs140, valuing the stock at 0.6x P/ABV on its FY25e book.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
