CLSA Issues Buy Rating for Bandhan Bank, Sets Target Price at ₹220. Bank's stock is currently 34% below its high, with potential for a 50% upside.
Bank Stock: Domestic markets have witnessed seven consecutive days of gains. Nifty 50 and Sensex have shown a 5.6% increase in recent trading sessions, although they remain approximately 10% below their September record highs. Amidst this recovery, brokerage firm CLSA has issued a buy rating for Bandhan Bank and set a target price of ₹220, implying a potential stock increase of up to 50%.
Bandhan Bank Stock Performance
Bandhan Bank shares are currently trading around ₹148, which is 34% below their high. The stock has risen 10.9% in the last month, while it has declined by 27.55% in the past six months. However, it has fallen 18.4% year-to-date. Bandhan Bank's 52-week high is ₹222, and its 52-week low is ₹128.
CLSA's Opinion and Bank Improvements
CLSA anticipates improvements in Bandhan Bank's microfinance (MFI) sector, particularly due to increased collection efficiency over the past two months. Overdue formations have shown a quarterly decline, suggesting an improving bank outlook. However, some new regulatory measures may cause temporary setbacks in the coming months. The bank expects the situation to normalize by the third quarter of fiscal year 2025-26.
Recent Technological Improvements
The bank recently partnered with Salesforce to implement a new loan origination system (LOS). This system will be rolled out across 1,700 branches in the coming months, streamlining loan processing and improving customer service.
