Shares of Bandhan Bank on Monday dropped 2.61 per cent to hit a 52-week low of Rs 210.50 on BSE. The stock has declined 6.84 per cent in the previous five sessions. On a year-to-date (YTD) basis, the scrip traded a little over 41 per cent lower.
Around 2.50 lakh shares changed hands today, amounting to a turnover of Rs 5.42 crore. The market capitalisation of (m-cap) Bandhan Bank stood at Rs 34,036.75 crore.
Analysts opined that the stock traded in the ‘oversold’ zone and cited Rs 200 as “a significant psychological support level.”
Pavitra Shetty of Tips2trades said, “Below average Q2 FY23 results despite signs of strong credit growth has dampened investors’ spirits leading to Bandhan Bank slipping lower and lower. Investors should buy this stock only on a close above Rs 235, which could lead to a bounce back till 256-275 in the near term.” On the downside, a close below Rs 212 can lead to Rs 188 level as charts are very oversold, she added.
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Pravesh Gour, Senior Technical Analyst at Swastika Investmart, said the counter has seen a breakdown of a long consolidation pattern formation. “The overall structure is distorted as it trades below all its SMA (Simple Moving Average), and the momentum indicators are also negatively poised. On the downside, Rs 200 is a strong and significant psychological support level from which we can expect a bounce-back up to Rs 230; below this, Rs 150,” Gour stated.
Tirthankar Das of Ashika Stock Broking said Bandhan’s share price has been on a sequential decline since January 2021 and the slower pace of retracement suggests inherent weakness in the stock.
“On the oscillator front, in the daily time frame, the 14-period RSI is seen dripping towards the oversold territory thus indicating that sustenance above the support level of 200 can ultimately lead to a pullback. Thus, it would be advisable to approach the stock with the buy-on-strength method i.e. at a decisive trade above 265 one can initiate a buy position with an upside target of Rs 300-320,” Das said.
Bandhan Bank reported a net profit of Rs 209 crore for the September quarter compared with a Rs 3,009 crore loss in the year-ago period due to higher asset quality stress, percolating into high-interest income reversals and increased write-offs.
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Elara Securities, in a post-earnings’ note, said, “High slippages fed into higher interest income reversal ensuing a 100 basis points (bps) sequential NIM (net interest margin) dip, thus lowering NII — net interest income — (down 13 per cent QoQ). Notwithstanding weak H1FY23, we believe, the end of asset quality uncertainty seems nigh. That said, recovery trends are far slower than anticipated. Volatile performance dented investor confidence. A re-rating hinges on consistent earnings delivery.”
Meanwhile, Indian equity benchmarks plunged sharply in today’s deals amid weak cues from the global markets.
