Rekha Jhunjhunwala Portfolio: Why Is This ₹300 Bank Stock Falling?

According to stock market experts, Canara Bank has reported improvement in NIM in the fourth quarter results but it is not enough to attract buyers as other banks have reported better NIM. He said that it is waiting for improvement rekha jhunjhunwala portfolio stock because it was trading at a higher valuation than its peers. He advised investors to wait for further downside and buy near the current support levels.

Canara Bank Q4 Results

Talking on why Canara Bank share price is falling, Vaibhav Vidwani, Research Analyst, Bonanza Portfolio Ltd. said, “High growth in risky assets can have a negative impact on the asset quality of Canara Bank. Also, Canara Bank has reported a marginal improvement in NIM. An increase from 2.93 per cent in Q3FY23 to 2.95 per cent in Q4FY23, while its peers have shown significant growth in NIM. As a result of the above factors, investors have not shown much interest in Canara Bank shares. Another reason for this fall could be that Canara Bank share price has given 3.0 times price movement in last 3 years, leading to higher valuations compared to peers.”

The Bonanza portfolio specialist further said that Canara Bank showed high growth in most risky advances, in agriculture loans, it showed a growth of 21 per cent, while corporate and other loans grew by 20.60 per cent. The GNPA of agriculture loan is 3.4 per cent while the GNPA of corporate loan is 6.44 per cent.

Speaking on Canara Bank’s performance in FY23, Vaibhav Vidwani, Bonanza Portfolio said, “In FY23, Canara Bank has shown a growth of 19.14% in Net Interest Income. 31435.29 crores with a net profit registering a growth of 86.76 percent 10604 cr. Canara Bank’s asset quality has improved as the gross non-performing assets (GNPA) ratio declined to 5.31 per cent at the end of FY22 from 5.89 per cent at the end of FY22. Over the past two years, the lender has seen a sharp improvement in asset quality with NPAs reducing from 7.5 per cent in FY18 to 1.73 per cent in FY23. PSU Bank Advances have shown a growth of 18 per cent in FY23, but it has given only 8.5 per cent growth in deposits.”

Canara Bank Share Price Target

Vaishali Parekh, Vice President – Technical Research, Prabhudas Lilladher advised positional investors to wait for more correction said, “Canara Bank stock recovered marginally with profit booking after finding resistance near 326 zone and is the near term support level. 285 where it can maintain and stop the slide. RSI shows exhaustion near peak zone 326 overbought zone and slipped below, which is now well placed. can monitor the level of 285 as the support area and wait for a revival. the near term goal would be then from 320 325 level.”

Rekha Jhunjhunwala Shareholding

As per the shareholding pattern of Canara Bank 3,75,97,600 with Rekha Jhunjhunwala for the quarter January to March 2023 Canara Bank shares, which constitute 2.07 per cent of the total paid-up capital of the state-owned bank.

Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint. We advise investors to do due diligence with certified experts before making any investment decision.