MAHABANK - Investment Analysis

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

Investment Rating: 4.0

Here’s a full-spectrum analysis of Bank of Maharashtra (MAHABANK) to help you evaluate its long-term potential

🧮 Fundamental Snapshot

Valuation

P/E: 7.58 vs Industry P/E: 7.49 — fairly valued.

PEG Ratio: 0.11 — extremely attractive, indicating strong earnings growth relative to valuation.

Profitability

ROE: 22.8% — excellent, suggesting strong shareholder value creation.

ROCE: 5.72% — low, typical for PSU banks with large asset bases.

Dividend Yield: 2.64%

Decent for income-focused investors.

Balance Sheet

Debt-to-equity: 11.5 — high, but expected for banks due to their leveraged business model.

Quarterly Performance

PAT stable at ₹1,504 Cr., with QoQ growth of 16.2% — solid momentum.

EPS: ₹7.63 — consistent earnings base.

Institutional Sentiment

FII holding up (+0.17%), DII slightly down (-0.27%) — neutral to mildly positive.

📈 Technical Indicators & Entry Zone

Current Price: ₹56.8

Trading above DMA-50 (₹55.1) and DMA-200 (₹53.4) — bullish trend intact.

RSI: 54.3 — neutral zone, no immediate overbought/oversold signal.

MACD: +0.45 — mild bullish crossover.

🟢 Ideal Entry Zone: ₹52–₹55 This range offers a better valuation buffer and aligns with technical support levels.

🛡️ Exit Strategy / Holding Period

If you already hold the stock

📌 Consider a 3–5 year horizon, especially for dividend income and PSU banking exposure.

Reassess if ROE drops below 15% or PEG ratio rises above 0.5 without EPS growth.

Exit Signals

Sustained drop below ₹50 with deteriorating fundamentals.

Continued DII outflows or macro headwinds in the banking sector.

Regulatory or asset quality concerns impacting profitability.

🧾 Summary

Bank of Maharashtra is a value-centric PSU bank with strong ROE, attractive PEG ratio, and a decent dividend yield. While ROCE and debt levels raise caution, its valuation and earnings potential make it a moderate-risk long-term hold. Ideal for investors seeking stability with upside potential.

Want to compare this with SBI or Canara Bank for a broader PSU banking view? I can help you build a sectoral strategy.

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