J&KBANK - Fundamental Analysis

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

Fundamental Rating: 3.8

Let’s decode Jammu & Kashmir Bank (J&KBANK) from all the angles that matter 🧩📊

🧾 Core Financials

Profitability

ROE: 15.8% shines among public sector banks — shows efficient shareholder value creation.

ROCE: 6.15% — acceptable, though asset-heavy banks often show modest returns.

Earnings Performance

EPS: ₹19.5 — solid for its price level.

PAT declined from ₹582 Cr. to ₹485 Cr., yet Qtr Profit Var at +15.8% YoY suggests resilience.

Leverage

Debt-to-equity: 10.6 is typical for banks, where deposits count as liabilities — not a red flag but worth tracking through asset quality metrics.

Dividend Yield

2.03% — attractive for yield investors, especially at current valuations.

📉 Valuation Metrics

Metric Value Comment

P/E Ratio 5.44 🎯 Deeply undervalued vs. industry avg (12.6)

P/B Ratio ~0.82 Below book value — signs of pessimism or opportunity

PEG Ratio 0.09 🔥 Extremely undervalued relative to growth expectations

🔍 Interpretation: This is a textbook deep value stock — especially with its PEG and P/E combo.

🧠 Business Model & Competitive Edge

J&K Bank holds strong regional dominance in Jammu & Kashmir and Ladakh.

Local trust and dense branch network offer a moat against national banks.

Focus on MSME and agri-finance ties well with central growth narratives.

FII Holding: +0.37% — rising foreign interest.

DII Holding: -0.82% — suggests domestic caution or rotation out.

📍 Technical View & Entry Zone

Price: ₹106, straddling DMA-50 (₹108) and DMA-200 (₹104) — hovering in a consolidation range.

RSI 42.7 — mildly oversold, could be building base.

MACD -0.03 — flat, awaiting directional cue.

📌 Suggested Entry Zone

Sweet spot for entry: ₹98–₹106, especially if RSI begins to climb or MACD turns positive.

Strong support at ₹95; breakout potential above ₹110.

🕰️ Long-Term Holding Perspective

Low valuation and high ROE make it appealing for a 2–3 year horizon.

Risks: regional geopolitics, asset quality, and regulatory pressure.

Dividend and earnings power add stability for patient investors.

If you're looking for similarly undervalued banks to build a diversified basket — think UCO Bank, Indian Bank, or even Dhanlaxmi Bank. Want me to explore those next? 🏦📘

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