Jhunjhunwala-family-owned lender stock falls over 2% as weak margins in Q3 weighed
At around 10:15 am, the stock traded weak by over 1 per cent at Rs 147.7, while at the day’s low, it hit a price of Rs 145.8, down 2.61 per cent.
Jhunjhunwala-family-owned stock, Federal Bank, traded in the red in early trade on Wednesday, January 17, after the lender posted its December quarter (Q3 FY24) results on Tuesday. At around 10:15 am, the stock traded lower by over 1 per cent at Rs 147.7, while at the day’s low, it hit a price of Rs 145.8, down 2.61 per cent.
The lender posted a 25 per cent increase in profit for Q3, which came in at Rs 1,007 crore as against Rs 804 crore in the same period last year.
What do brokerages make of the stock?
Global brokerage JP Morgan has retained its ‘overweight’ rating on the stock with a target of Rs 175 per share.
Morgan Stanley, on the other hand, maintained its ‘equal weight’ stance on the counter with a target of Rs 165. The brokerage mentioned that margins at the lender during Q3 remained under pressure and were down 3 basis points (year-on-year). Furthermore, the brokerage estimated that the return on assets, or RoA, which came in at 1.4 per cent has been aided by favourable credit costs.
The brokerage also pointed out that, though the Treasury gains remained strong, they were deployed to offset the higher-than-expected wage hike run rate. The stock is available at cheap valuations and trading at 1.0x F25 core book; nonetheless, there is an absence of a strong catalyst.
How do other analysts view the stock?
The consensus recommendation from 28 analysts is a buy, Trendlyne data shows.
The stock in the last one year has largely underperformed the headline indices, with a return of just 4.7 per cent.
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.
RECOMMENDED STORIES
PM Modi has invested in this post office scheme; know his total worth as per Lok Sabha elections 2024 affidavit
SRH vs GT IPL 2024 Ticket Booking Online: Where and how to buy SRH vs GT tickets online - Check IPL Match 66 ticket price, other details
Top 7 SWP Mutual Funds: Rs 50 lakh investment, Rs 70K monthly pension for 10 years, and Rs 42.30 lakh balance value; know more details
Gold and Silver rate today (May 13, 2024): Precious metal under pressure; yellow metal near Rs 72,400, white metal above Rs 84,600
SIP Returns: How Rs 3,000, 5,000, and Rs 10,000 SIPs can help you build retirement corpus of Rs 1.06 cr, Rs 1.77 cr, and Rs 3.53 cr
TBO Tek IPO Listing LIVE Update: Bumper Debut! Share list at 55% premium - Buy, sell or hold? Check Anil Singhvi's view
01:12 PM IST