Buy Jammu & Kashmir Bank; target of Rs 100: Prabhudas Lilladher

Prabhudas Lilladher’s research report on Jammu & Kashmir Bank

JKBK’s earnings was lower than expected on flat NII on higher interest reversals despite loan growth of 10% YoY and lower of cost of funds on better CASA. Asset quality was stable on sale to ARC on slippages from the restructured book largely from non-J&K state. J&K restructured book also saw some slippages on account of RBI divergence noted in few accounts (large borrowal) leading to interest reversals but rest of the book is functioning well and if the same continues bank could likely witness significant addition to NII (7% of loans under J&K restucturing) and if there are any resolutions in IBC referred loan assets

Outlook

We believe, better PCR, improving NIMs and recovery in loan growth augurs well and hence we retain BUY with revised TP of Rs100 (down from Rs112) based on 1.2x Mar-20ABV.

For all recommendations report,click here

related news Buy Coal India; target of Rs 340: Prabhudas Lilladher Buy Ipca Laboratories; target of Rs 837: Prabhudas Lilladher Buy J.Kumar Infraprojects; target of Rs 365: Prabhudas Lilladher

Disclaimer:The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Read More
First Published on Jun 8, 2018 04:19 pm

Leave a Reply

Your email address will not be published. Required fields are marked *