“Oriental Bank of Commerce, net profit down by 24% to Rs. 1,141.56 crores in FY12 as against of Rs 1,502.9 crores in FY11. OBC has high amount of slippages in this fiscal year but going forward the slippages are expected to be subdued as compared to the current year and recoveries are anticipated to increase. At current market price of Rs 220, the stock quotes at 0.55x adjusted book value FY13 at Rs 406.00. However we revise our PAT estimates by 3% and 5% for FY13 and FY14 respectively. The management is confident of achieving industry average growth along with improved margins in near future but the concern is the asset quality for a bank. We value the bank at Rs 223 at 0.65x ABV FY13; we rate the stock as a NEUTRAL with a target of Rs 263,” says Magnum research report.
No comments:
Post a Comment