PNB - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.0

📊 Core Financials Analysis

Profitability

ROE: 14.2% — solid for a public sector bank, reflecting decent shareholder returns.

ROCE: 6.30% — modest, typical for capital-heavy banking operations.

EPS: ₹13.1 — healthy, though recent PAT dropped from ₹4,567 Cr to ₹1,675 Cr (−48.5%), indicating earnings volatility.

Balance Sheet & Cash Flow

Debt-to-equity: 12.6 — high, but expected for banks due to their lending structure.

Dividend Yield: 2.59% — attractive for income-focused investors.

Book Value: ₹115 vs Current Price: ₹112 — trading slightly below book, suggesting undervaluation.

📉 Valuation Indicators

Metric Value Interpretation

P/E Ratio 8.54 Slightly above industry average (7.91) — still undervalued

P/B Ratio ~0.97 Undervalued — price below book value

PEG Ratio 0.12 Deeply undervalued relative to growth

Intrinsic Value ₹125–₹135 (est.) Current price ~10–20% below fair value

🧠 Business Model & Competitive Edge

Company Profile: Punjab National Bank (PNB) is one of India’s largest public sector banks, offering retail, corporate, and digital banking services.

Strengths

Strong government backing and systemic importance.

Expanding digital footprint and improving asset quality.

Institutional interest rising — DII holdings up by 0.39%.

Challenges

High leverage and earnings volatility.

Competitive pressure from private banks and fintech disruptors.

📈 Technical & Sentiment Overview

RSI: 69.0 — nearing overbought zone, short-term caution advised.

MACD: 1.10 — mildly bullish momentum.

DMA 50 & 200: Price above both — confirms uptrend.

Volume: Above average — strong investor interest.

💡 Entry Zone & Long-Term Guidance

Suggested Entry Range: ₹100–₹108 — near DMA 50 and below intrinsic value.

Holding Strategy

Suitable for long-term investors seeking value in public sector banking.

Analyst consensus targets for 2025 range from ₹115 to ₹180

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, with some estimates reaching ₹133.40

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.

Long-term targets for 2030 range from ₹700 to ₹1,500

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.

Monitor asset quality, NPA trends, and digital transformation initiatives.

PNB is a classic turnaround candidate with improving fundamentals and strong macro tailwinds. If you're building a portfolio with exposure to India’s financial sector, this one deserves a close look.

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moneymintidea.com

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trendlyne.com

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