Traders book profit in this bank stock after 4 days of non-stop rally

Shares of Karnataka Bank have fallen on Monday after 4 days of consecutive rally as traders booked profits in the stock. Earlier in the day, shares of the private lender logged over 4% gains and marked a new 52-week high of Rs 144.25 per share on the NSE. In Friday’s session, the stock closed at Rs 138.2.

On November 2, the stock clocked around 20% gains after strong earnings for the quarter ended September. During the quarter, the Mangaluru-headquartered bank posted an all-time high quarterly net profit of Rs 411.5 crore, recording 228% growth compared to the profit during the same period last year.

Its net interest income (NII) also increased for the quarter by 26 per cent to Rs 802.73 crore from Rs 637.10 crore reported during the same period last year.

The lender’s asset quality improved as GNPAs reduced to 3.36% as against 4.03% as of the previous quarter, while net NPAs also reduced to 1.72 per cent against 2.16 per cent as of the previous quarter.

On a YTD basis, the stock of Karnataka Bank has yielded a return of 120% while its 1-year return is at 92%.


Pravesh Gour, Senior Technical Analyst, Swastika Investmart, on the counter, said, “The counter has come out of long consolidation as well as an Inverse Head and Shoulder Pattern breakout in the longer timeframe with strong volume, and it has completed the target as per the pattern breakout. The current structure of the counter looks very bullish, as it has traded above all important moving averages. But investors have to book a portion of profit at Rs 140–142 levels. For aggressive investors, they may take positions above Rs. 144 with a stop loss of Rs 128 for a target Rs. 174.”