BANKINDIA - Fundamental Analysis

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

Fundamental Rating: 3.7

Let’s unpack the essentials of Bank of India (BANKINDIA) with a sharp lens on its fundamentals, valuation dynamics, operational health, and long-term potential

🧾 Core Financials & Performance

EPS: ₹20.8 — decent earnings, though not standout.

PAT Trend: ₹2,205 Cr vs ₹2,602 Cr — a drop (~15%) could reflect provisioning or cyclical pressures.

ROE: 12.4% — moderate, reflects acceptable shareholder value creation.

ROCE: 6.17% — low, common among PSU banks due to capital intensity.

Debt-to-Equity: 11.9 — typical for banks with vast deposit liabilities.

Dividend Yield: 3.61% — attractive for income-focused investors.

💸 Valuation Metrics

P/E Ratio: 5.18 vs Industry PE of 7.49 — stock is undervalued relative to peers.

P/B Ratio: ~0.63 (₹112 ÷ ₹178) — deep value territory, below book value.

PEG Ratio: 0.12 — highly favorable; indicates value with growth potential.

Intrinsic Value: Likely above current price — offering meaningful upside if fundamentals improve.

🧠 Business Model & Strategic Outlook

Profile: A major PSU bank with retail, MSME, and corporate lending footprint.

Strengths

Wide branch network and public trust.

Participation in government schemes (PMAY, Mudra, etc.).

Quarterly PAT growth of 16.8% — encouraging.

Risks

Volatile profitability and provisioning spikes.

Decline in FII holding (–0.35%) — hinting at institutional caution.

Digital competitiveness lagging behind private peers.

📉 Technical Perspective

RSI: 39.2 — nearing oversold, could trigger technical bounce.

MACD: –1.44 — weak bearish momentum; signal deterioration.

Volume: Lower than average — market waiting for clearer triggers.

🎯 Recommended Entry Zone

₹105 – ₹115: Ideal buying window near DMA 200, with technical support.

Deeper dips near ₹100 may offer excellent long-term value.

📈 Long-Term Holding Guidance

Suitable for a 3–5 year investment horizon

Low valuation metrics and healthy dividend yield.

Recovery in credit cycle and PSU reforms could unlock upside.

Works best as a contrarian value bet in a diversified portfolio.

Would you like me to chart a PSU bank portfolio with Bank of India, Canara, PNB and SBI side by side? Could be a powerful lens into dividend yield, credit quality, and long-term value capture. Let’s build that, if you're game.

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