ICICI Securities projects a 40% upside potential in Karur Vysya Bank (KVB), with a target price of ₹300 based on anticipated improved growth in FY26.
Bank share: Domestic stock markets are experiencing volatility due to concerns about potential Trump tariffs in the US. However, a good recovery was observed during the initial session on Thursday. Amidst this market instability, an investment opportunity is emerging in the shares of the private sector Karur Vysya Bank (KVB). Brokerage firm ICICI Securities has adopted a bullish stance on the bank, projecting a potential rise of up to 40%.
Recommendation to buy KVB stock
ICICI Securities presents a positive outlook for Karur Vysya Bank's shares. The brokerage believes the bank can demonstrate b long-term growth. The firm has set a target price of ₹300 for the bank's shares, approximately 40% higher than the current market price (₹214).
Tuesday's closing price: ₹214
52-week high: ₹246
52-week low: ₹98
Potential upside: 40%
Recent Stock Performance
Karur Vysya Bank's shares have shown strength recently. The stock has risen by more than 7% in the last month.
Last one year: 15% return
Last two years: Over 100% return
Trading at a 14% discount from its 52-week high.
Brokerage Opinion: Strong Performance Expected by FY26
ICICI Securities recently met with Karur Vysya Bank's top management and business heads. Their confidence in the bank's growth and earnings stability was further strengthened during these meetings.
Loan Growth: KVB is consistently recording b and stable loan growth.
Liquidity: As market liquidity improves, new opportunities will arise for the bank.
NII (Net Interest Income): Some pressure may persist in the short term, but this will be balanced by recovery and fee income.
Asset Quality: The bank's asset quality remains b, and credit risk is minimal.
Net NPA: Only 0.2%
Unsecured Loan Portfolio: Less than 3%
RoA (Return on Asset): 1.6%
RoE (Return on Equity): 16%
KVB could join the ranks of large banks by FY26
ICICI Securities believes that Karur Vysya Bank, due to its b performance, could join the ranks of larger private sector banks in the future. The bank has a b balance sheet, and there is significant potential for improvement in credit growth.
