⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
INDIANB - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.0
| Stock Code | INDIANB | Market Cap | 1,13,613 Cr. | Current Price | 843 ₹ | High / Low | 923 ₹ |
| Stock P/E | 9.46 | Book Value | 581 ₹ | Dividend Yield | 1.93 % | ROCE | 6.38 % |
| ROE | 17.1 % | Face Value | 10.0 ₹ | DMA 50 | 837 ₹ | DMA 200 | 736 ₹ |
| Chg in FII Hold | 0.96 % | Chg in DII Hold | -0.80 % | PAT Qtr | 3,061 Cr. | PAT Prev Qtr | 3,018 Cr. |
| RSI | 47.5 | MACD | 17.2 | Volume | 20,98,269 | Avg Vol 1Wk | 18,60,541 |
| Low price | 478 ₹ | High price | 923 ₹ | PEG Ratio | 0.23 | Debt to equity | 10.7 |
| 52w Index | 82.0 % | Qtr Profit Var | 7.33 % | EPS | 89.2 ₹ | Industry PE | 7.64 |
📊 Core Financials
- Revenue & Profitability: PAT improved slightly from 3,018 Cr. to 3,061 Cr. QoQ (+7.33%), showing consistent earnings growth.
- Margins: ROE at 17.1% is strong, while ROCE at 6.38% indicates modest efficiency in capital utilization.
- Debt: Debt-to-equity ratio of 10.7 is very high, reflecting significant leverage risk typical of banks.
- Cash Flow: Dividend yield of 1.93% provides moderate shareholder reward.
💹 Valuation Indicators
- P/E Ratio: 9.46 vs Industry PE of 7.64 → slightly overvalued compared to peers.
- P/B Ratio: Current Price (843 ₹) / Book Value (581 ₹) ≈ 1.45, reasonable for a bank.
- PEG Ratio: 0.23 indicates attractive valuation relative to growth prospects.
- Intrinsic Value: Current price near DMA 50 (837 ₹) and above DMA 200 (736 ₹), suggesting technical strength and fair valuation.
🏦 Business Model & Competitive Advantage
- Indian Bank operates as a large public sector bank with diversified lending across retail, corporate, and rural segments.
- Competitive advantage lies in government backing, wide branch network, and strong deposit base.
- Overall health is stable, with consistent profitability but high leverage risk inherent to the sector.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive entry between 800 ₹ – 820 ₹, near support levels.
- Long-Term Holding: Suitable for investors seeking stable banking exposure with strong ROE, but requires monitoring of debt levels and sector risks.
✅ Positive
- Strong ROE (17.1%) indicates healthy shareholder returns.
- PEG ratio (0.23) suggests undervaluation relative to growth.
- Consistent PAT growth and stable earnings.
⚠️ Limitation
- High debt-to-equity ratio (10.7) reflects leverage risk.
- ROCE (6.38%) remains modest compared to private peers.
- P/E slightly higher than industry average, limiting upside.
📉 Company Negative News
- DII holdings decreased (-0.80%), showing reduced domestic institutional confidence.
- High leverage continues to weigh on investor sentiment.
📈 Company Positive News
- FII holdings increased (+0.96%), reflecting foreign investor interest.
- PAT improved QoQ, showing consistent profitability.
🏭 Industry
- Industry PE at 7.64 is slightly lower than Indian Bank’s PE, highlighting mild overvaluation.
- Banking sector growth driven by credit expansion, digital adoption, and government support.
- Competition from private banks remains strong, but PSU banks benefit from scale and government backing.
🔎 Conclusion
- Indian Bank offers strong ROE and consistent profitability, supported by government backing.
- Valuation is fair, though slightly above industry average, with PEG ratio highlighting growth potential.
- Best suited for long-term investors entering near 800–820 ₹, with monitoring of debt levels and sector dynamics.
I can also prepare a comparative HTML report of Indian Bank versus other PSU banks like SBI and Bank of Baroda to highlight relative valuation and performance strength.