Summary
Citi has reiterated a Buy rating for BOB stock with a target price of Rs 340, despite a projected seasonal Q1 contraction in advances and deposits. The bank also settled the NMC Holding case for Rs 5700 crore and anticipates potential Q1 impact from floating provisions.
BOB Stock Update: Citi Maintains Buy Rating, Q1 Outlook
Highlights
Q1 Performance Expectations
Q1 is expected to show a seasonal quarter-on-quarter contraction in both advances and deposits. Return on Assets (RoA) is also anticipated to be below 1% due to moderating Net Interest Margin (NIM) and recoveries.
NMC Holding Case Settlement and Provisions
BOB has settled the Rs 5700 crore NMC Holding case. The bank has floating provisions totaling Rs 1500 crore, suggesting a possible financial impact in the first quarter.
Citi's Rating and Price Target
Citi has maintained its 'Buy' rating on BOB stock, setting a target price of Rs 340.