BANKBARODA - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

🧠 How I’m Thinking About This

You’re asking for a full-spectrum fundamental analysis of Bank of Baroda (BANKBARODA), a major public sector bank with strong domestic and international presence. I’m evaluating its financial strength, valuation metrics, business model, and technical indicators to determine its long-term investment potential and ideal entry point.

📊 Core Financials Breakdown

Profitability & Growth

EPS: ₹38.0 — strong earnings base

PAT Qtr: ₹4,541 Cr vs ₹5,048 Cr — stable, slight dip

ROE: 15.7%, ROCE: 6.24% — solid shareholder returns, modest operational efficiency

Qtr Profit Var: +1.87% — consistent performance

Balance Sheet Strength

Debt-to-equity: 11.0 — typical for banks, not alarming

Book Value: ₹275 — price-to-book ratio ~0.91, undervalued

Dividend Yield: 3.35% — attractive for income investors

💰 Valuation Indicators

Metric Value Interpretation

P/E Ratio 6.55 Undervalued vs industry PE of 7.91

P/B Ratio ~0.91 Trading below book value — attractive

PEG Ratio 0.17 Deep value — growth justifies price

Intrinsic Value ~₹265–₹275 Slightly undervalued at current price

Valuation is compelling, especially with strong earnings and low P/E and P/B ratios.

🏦 Business Model & Competitive Edge

Industry: Banking — essential, regulated, and cyclical

Moat: Large branch network, strong government backing, diversified loan book

Catalysts

Retail and MSME loan growth

Digital banking expansion

DII holdings rising (+0.82%) — institutional confidence building

Bank of Baroda is well-positioned to benefit from India’s credit growth and financial inclusion push.

📉 Technical & Entry Zone

Current Price: ₹249

DMA 50/200: Trading above both — bullish trend

MACD: +0.83 — mild positive momentum

RSI: 66.7 — approaching overbought zone

📌 Suggested Entry Zone: ₹235–₹245

This range offers a better margin of safety and aligns with technical support levels.

🕰️ Long-Term Holding Guidance

Hold if already invested — strong fundamentals and attractive valuation

Buy on dips near ₹240 for long-term compounding

2026 Target Price: ₹310–₹330 based on projected earnings and sector tailwinds

⭐ Fundamental Rating

4.4

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