⚠ 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.
RBLBANK - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.4
| Stock Code | RBLBANK | Market Cap | 18,060 Cr. | Current Price | 292 ₹ | High / Low | 332 ₹ |
| Stock P/E | 27.3 | Book Value | 257 ₹ | Dividend Yield | 0.34 % | ROCE | 6.04 % |
| ROE | 4.57 % | Face Value | 10.0 ₹ | DMA 50 | 304 ₹ | DMA 200 | 273 ₹ |
| Chg in FII Hold | 6.42 % | Chg in DII Hold | 4.41 % | PAT Qtr | 214 Cr. | PAT Prev Qtr | 179 Cr. |
| RSI | 41.8 | MACD | -3.86 | Volume | 57,15,487 | Avg Vol 1Wk | 48,22,579 |
| Low price | 149 ₹ | High price | 332 ₹ | PEG Ratio | 0.22 | Debt to equity | 8.32 |
| 52w Index | 78.1 % | Qtr Profit Var | 555 % | EPS | 10.8 ₹ | Industry PE | 15.8 |
📊 Core Financials
- Revenue & Profitability: Quarterly PAT at ₹214 Cr, up from ₹179 Cr, showing strong sequential growth. EPS at ₹10.8 is modest relative to market cap.
- Margins: ROE at 4.57% and ROCE at 6.04% reflect weak efficiency and profitability compared to peers.
- Debt Ratios: Debt-to-equity at 8.32 is very high, typical for banks but still a structural risk.
- Cash Flows: Operating cash flows supported by profitability, though leverage and asset quality risks remain.
💹 Valuation Indicators
- P/E Ratio: 27.3, significantly higher than industry average of 15.8, suggesting premium valuation.
- P/B Ratio: Current price ₹292 vs. book value ₹257 → ~1.14x, fairly reasonable relative to assets.
- PEG Ratio: 0.22, attractive, showing growth potential relative to valuation.
- Intrinsic Value: Valuation appears stretched on P/E basis, but P/B and PEG suggest some margin of safety.
🏢 Business Model & Competitive Advantage
- RBL Bank operates as a private sector bank with focus on retail, corporate, and SME lending.
- Competitive advantage lies in niche retail presence and growing digital banking initiatives.
- Business model benefits from credit expansion, though profitability remains subdued compared to peers.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive accumulation range between ₹270 – ₹285, near DMA200 and support levels.
- Long-Term Holding: Suitable for investors seeking growth exposure in private banking, though high leverage and weak ROE must be monitored closely.
✅ Positive
- Quarterly PAT growth from ₹179 Cr to ₹214 Cr.
- Strong institutional confidence with FII (+6.42%) and DII (+4.41%) increases.
- 52-week performance shows 78.1% gain.
⚠️ Limitation
- High debt-to-equity ratio (8.32) increases financial risk.
- ROE at 4.57% and ROCE at 6.04% reflect weak efficiency.
- P/E ratio of 27.3 is expensive compared to industry average.
📉 Company Negative News
- Weak profitability metrics despite growth in PAT.
- High leverage remains a structural concern.
📈 Company Positive News
- Quarterly profit variation of 555% YoY highlights strong recovery momentum.
- Institutional investors increased holdings significantly.
- Stock has rebounded strongly from 52-week low of ₹149.
🏭 Industry
- Private banking sector trades at industry PE of 15.8, lower than RBL Bank’s 27.3, showing premium valuation.
- Sector growth supported by credit expansion and digital adoption, though asset quality remains a challenge.
🔎 Conclusion
- RBL Bank shows strong profit growth and institutional support but suffers from weak efficiency and high leverage.
- Valuation is stretched on P/E basis, though PEG and P/B offer some comfort.
- Best suited for long-term investors willing to accept higher risk, with entry around ₹270 – ₹285 providing a reasonable margin of safety.
I can also prepare a comparative HTML snapshot of RBL Bank versus Federal Bank to highlight differences in valuation, profitability, and risk profile.