PNB - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.4
| Stock Code | PNB | Market Cap | 1,25,687 Cr. | Current Price | 109 ₹ | High / Low | 135 ₹ |
| Stock P/E | 7.74 | Book Value | 124 ₹ | Dividend Yield | 2.65 % | ROCE | 6.30 % |
| ROE | 14.2 % | Face Value | 2.00 ₹ | DMA 50 | 114 ₹ | DMA 200 | 115 ₹ |
| Chg in FII Hold | 0.46 % | Chg in DII Hold | -0.04 % | PAT Qtr | 5,100 Cr. | PAT Prev Qtr | 4,904 Cr. |
| RSI | 43.3 | MACD | -0.42 | Volume | 1,68,18,211 | Avg Vol 1Wk | 1,56,00,148 |
| Low price | 89.4 ₹ | High price | 135 ₹ | PEG Ratio | 0.11 | Debt to equity | 12.3 |
| 52w Index | 43.6 % | Qtr Profit Var | 13.1 % | EPS | 14.1 ₹ | Industry PE | 7.99 |
📊 PNB offers fair valuations with a low P/E (7.74 vs industry 7.99), decent ROE (14.2%), and a healthy dividend yield (2.65%). EPS of ₹14.1 supports valuation comfort, while quarterly PAT growth (+13.1%) reflects earnings momentum. However, ROCE is modest (6.30%) and the debt-to-equity ratio is very high (12.3), typical of banking operations but still a risk factor. The PEG ratio (0.11) suggests undervaluation relative to growth, though technical indicators show weak momentum (RSI 43.3, MACD -0.42).
💡 Ideal Entry Price Zone: ₹105 – ₹107 (near DMA 200 and slightly below current levels).
⏳ Exit Strategy / Holding Period: Long-term investors can hold for 3–5 years, benefiting from dividend yield and earnings growth. Partial profit booking is advisable near ₹125–₹130. Monitoring asset quality, ROE sustainability, and debt levels is essential for extended holding.
✅ Positive
- Attractive valuation with P/E (7.74) in line with industry average.
- ROE of 14.2% indicates decent profitability.
- Dividend yield of 2.65% provides steady income.
- Quarterly PAT growth (+13.1%) shows earnings momentum.
- EPS of ₹14.1 supports valuation comfort.
- FII holdings increased (+0.46%), showing institutional confidence.
⚠️ Limitation
- High debt-to-equity ratio (12.3) reflects leveraged balance sheet.
- ROCE at 6.30% is modest compared to peers.
- MACD negative (-0.42) suggests weak near-term momentum.
- RSI at 43.3 indicates neutral to weak strength.
📉 Company Negative News
- High leverage raises concerns about asset quality in stressed market conditions.
- Stock corrected from 52-week high (₹135 to ₹109).
📈 Company Positive News
- Quarterly PAT improved (₹5,100 Cr vs ₹4,904 Cr).
- Dividend yield supports investor returns.
- Institutional investors increasing stake.
🏭 Industry
- Banking sector benefits from credit demand and economic recovery.
- Industry P/E at 7.99 shows PNB trades in line with peers.
🔎 Conclusion
PNB is a fairly valued banking stock with decent ROE and dividend yield, making it suitable for medium- to long-term investors. New investors should wait for entry around ₹105–₹107 for better valuation comfort. Existing holders can maintain positions for 3–5 years, with partial profit booking near highs. Long-term holding depends on sustained profitability and improved ROCE.