These PSU bank shares will touch the level of ₹240, great opportunity to BUY after Q2 results

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PSU Bank Stock to Buy: Brokerage house has advised to buy government bank shares BoB. The brokerage says that earnings have increased due to increase in income from other income. The asset quality of the bank has improved.

PSU Bank Stock to Buy: The results of the second quarter (July-September 2023) of the companies listed in the stock market are coming. After the results, many shares are looking attractive for buying. Among these, one PSU bank is Stock Bank of Baroda (BoB). After the results, brokerage house Motilal Oswal has advised to buy government bank shares BoB. Brokerage says that the bank's earnings have increased. Asset quality has improved. On Tuesday (November 7), BoB shares closed at Rs 191.80, down 1.94 per cent.

 BoB: PSU bank will touch the level of ₹240

Brokerage house Motilal Oswal has maintained BUY advice on Bank of Baroda after Q2 results. Also, the target price per share has been kept at Rs 240. On 7 November 2023, the share price closed at Rs 192. In this way, at the current price, investors can get a strong return of about 25 percent. PSU Bank Stock has remained flat so far this year. The one year return is around 15 percent.

 The brokerage house says, the second quarter results for Bank of Baroda were mixed. Margins declined by 20bp (QoQ) to 3.07 percent. Due to good growth in all segments, business growth was 19 percent (YoY). There was a slight decline in CASA mix. The bank's recovery from write-off accounts has been good and guidance for 2HFY24 is also good. The asset quality of the bank has continuously improved. RoA/RoE of 1.2%/16.8% may be there in FY25E. Stock value is Rs 240 (1.1x FY25E ABV).

 BoB: How were the Q2 results?

 Bank of Baroda has made a net profit of Rs 4,252.89 crore in the September 2023 quarter. Compared to last year, profit has increased by 28.3 percent. The bank's GNPA was 3.32 percent of the loan book. A year ago it was 5.31 percent. Whereas the net NPA stood at 0.76 percent, which was 1.16 percent in the same quarter of the last financial year.

 The bank's net interest income jumped 6.4 percent year-on-year to Rs 10,831 crore, compared to Rs 10,174 crore interest income in the same quarter last year. BOB's provisions jumped 11 percent (QoQ) to Rs 2,161 crore from Rs 1,974 crore.