BANKBARODA - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.9

Here’s a well-rounded look into Bank of Baroda’s (BANKBARODA) financial fundamentals, valuation metrics, market positioning, and long-term investment potential

🏦 Core Financials & Profitability

EPS: ₹37.6 — reflects solid earnings base for a PSU bank.

Quarterly PAT: ₹3,469 Cr vs ₹5,420 Cr — notable drop (–26.6%); could be seasonal or provisioning-related.

ROE: 15.5% — healthy shareholder return.

ROCE: 6.29% — below par due to capital-intensive nature of banking.

Debt-to-Equity: 10.4 — typical for banks with large deposit liabilities.

Dividend Yield: 3.45% — generous payout, appealing for income investors.

💸 Valuation Metrics

P/E Ratio: 6.44 vs Industry PE of 7.49 — undervalued relative to peers.

P/B Ratio: ~0.81 (₹242 ÷ ₹297) — strong indicator of undervaluation; trading below book value.

PEG Ratio: 0.17 — extremely attractive; stock is cheap given its earnings growth profile.

Intrinsic Value: Appears higher than CMP — margin of safety intact.

🧠 Business Model & Strategic Outlook

Segment: Diversified public sector bank with global operations.

Strengths

Pan-India and overseas presence.

Solid retail and MSME loan book.

Improved asset quality and digitization drive.

Risks

Profit volatility due to provisioning and rate cycle.

Decrease in FII holding (–0.90%) — a cautious signal.

PSU overhang and regulatory pressures.

📉 Technical Snapshot

RSI: 49.9 — neutral zone; stock isn't overheated nor oversold.

MACD: +0.42 — slight bullish crossover forming.

Volume: Below average — quieter market activity.

🎯 Entry Zone Suggestion

₹230 – ₹240: Comfortable accumulation range near DMA 200.

If broader PSU rally continues, expect support near ₹225 for deeper value entry.

📈 Long-Term Investment Strategy

Bank of Baroda offers value for 3–5 year holding

Attractive valuation and improving fundamentals.

Digitization, retail lending expansion, and improved NPA management could be upside triggers.

Strong dividend yield and low PEG ratio add defensive appeal.

Want to build a PSU banking pack with SBI, PNB, or Canara for more diverse coverage? I can structure a portfolio review across the pack.

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