Mehabe score: 6 G Factor: 4 Piotski Score: 5 The stock has a rating HOLD. The mehabe team score is reflective of its fundamental and technical merits. A rating above 8 is considered good buy. The stock has a G-Factor of 4 and Piotski score of 5.
Description
Punjab National Bank is India’s first Swadeshi Bank. PNB is a Banking and Financial service bank owned by the Government of India with its headquarters is in New Delhi, India. It is the second largest PSU after SBI in India.#
Main Points
Ratios
Capital Adequacy Ratio – 13.88%
Net Interest Margin – 3.09%
Gross NPA – 12.99%#
Net NPA – 4.03%
CASA Ratio – 44.66%Site:PNB
Market Cap:
Rs 47,457 cr
Price:
43.1
Trading pe:
18.5x
Book-value:
58.0/share
Div yield:
0.00 %
Earning yield:
6.75%
Face-value:
2.00/share
52week high:
46.40
52week low:
26.30
Technical Analysis
Stock trades at 43.1, above its 50dma 38.25. It also trades above its 200dma 37.37. The stock remains bullish on techicals
The 52 week high is at 46.40 and the 52week low is at 26.30
Price Chart
P/E Chart
Sales and Margin
Strengths
– Stock is trading at 0.74 times its book value
– is expected to give good quarter
– has delivered good profit growth of 21.92% CAGR over last 5 years
Weakness
– Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
– has a low return on equity of -4.06% for last 3 years.
-Contingent liabilities of Rs.241351.94 Cr.
Competition
– The industry trades at a mean P/E of 15.4x. I O B trades at the industry’s max P/E of 63.59x. PNB trades at a P/E of 18.5x
– Industry’s mean G-Factor is 4.9 while the mean Piotski score is 8.0. PNB has a G-Factor of 4 and Piotski scoreof 5.
– Average 1 month return for industry is 16.2%. The max 1- month return was given by Bank of India: a return of 21.8 %
Quarterly Results
Profit & Loss Statement
Profit&Loss Comments
Company reported sales of Rs 81866.0 cr for period ended Mar 2021 vis-vis sales of Rs 54918.0 cr for the period ended Mar 2020, a healthy growth of 32.9%. The 3 year sales cagr stood at 18.9%.
Operating margins shrank to -9340.0% for period ended Mar 2021 vis-vis -7946.0% for period ended Mar 2020, contraction of 139400.0 bps.
Net Profit reported at Rs 2562.0 cr for period ended Mar 2021 vis-vis sales of Rs 438.0 cr for the period ended Mar 2020, rising 0%.
Balance Sheet Statement
Cash Flow Statement
Cash Flow comments
CashFlow from operating activities was positive.
CashFlow from operating activities: Rs 1240.0 cr for period ended Mar 2021 vis-vis Rs -12744.0 cr for period ended Mar 2020
Sales Growth
Profit Growth Statement
Profit Growth Statement
Stock Price CAGR
Return of Equity
General Comments
– The company has improved its Return on Equity (RoE) metric. The RoE on Last Year basis was 4.0% compared to -4.0% over the last 3 Years. – The stock has given a return of 28% on a 1 Year basis vis-vis a return of -21% over the last 3 Years. – The compounded sales growth on a TTM bassis is 49% vis-vis a compounded sales growth of 19% over the last 3 Years. – The compounded profit growth on a TTM basis is 539% vis-vis a compounded profit growth of 30% over the last 3 Years.
Ratios
Shareholding Pattern
– FII shareholding has remained largely constant. The Mar 2021 fii holding stood at 2.94% vis-vis 3.81% for Dec 2020 – Public shareholding has remained largely constant. The Mar 2021 public holding stood at 11.12% vis-vis 9.3% for Dec 2020
Conclusion
– Stock is trading at 0.74 times its book value
– is expected to give good quarter
– has delivered good profit growth of 21.92% CAGR over last 5 years – Though the company is reporting repeated profits, it is not paying out dividend
– has low interest coverage ratio.
– has a low return on equity of -4.06% for last 3 years.
-Contingent liabilities of Rs.241351.94 Cr.
The business fundamentals of the stock remain stable. Stronger near term results will build interest in the stock. We suggest to wait for a upturn in business performance.
Technically, the stock remains above its 50 DMA 38.25 and is trading at 43.1, thus bullish price action wise.
