Bandhan Bank: Negatives still outweigh positives
Published On: Tuesday, March 3, 2020 | By: Team KnowMyStock
Last week, the RBI lifted the ban on Bandhan Bank opening new branches. and the bank now plans to open 250 branches by the end of 2020. While the news seems to have helped Bandhan’s stock, which is down 2.6 percent since last Tuesday versus 5.3 percent fall in Sensex, it is still down by over 22 percent year-to-date, thanks to concerns over slowing growth and asset quality. Even though the Gruh Finance acquisition gave it a head-start in expanding its non-MFI business, Bandhan seems to have hit air pocket since then. Share of non-MFI loans remained stagnant at 39 percent in Q3, indicating that other streams of businesses aren’t helping much yet. Moreover, promoters of Bandhan Bank have to reduce their stake to 40 percent from 61 percent implying that the supply of shares in the open market may remain high. If demand for the stock isn’t encouraging, the scope for a sharp rebound in its price remains muted. In short, the negatives still outweigh positives.
Tags: Bandhan Bank
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