JK Bank scales to 5th rank among top 10 stocksThird among the bank stocks J&K Bank has ranked fifth among the top 10 rated sensitive stocks which can deliver up to 26 per cent return in near term, said a report that appeared ina prominent national business daily.“J&K Bank fell sharply on 30th May 2014 from a high of 1849 to a low of 1470. However, the stock has been showing signs of accumulation thereafter and continues to be in a strong uptrend. The risk reward ratio appears favorable”, the report said.Quoting Senior Vice President – Investment Strategies at Microsec Capital Vinit Pgaria, the report maintained an investment call of ‘Buy’ on the bank’s stock with the ‘Target Price’ fixed at Rs 1850 and predicted return of 14 percent inthe near term.The list collated by the report contains stocks of ICICI Bank, HDFC, PNB and Yes Bank besides Bajaj Auto, Reliance infrastructure, Larsen & Turbo, Sesa Sterlite and Inidabulls Real Estate.Notably, the bank ranks third among the bank stocks.J&K Bank share value has witnessed a whopping 92.9 per cent growth in last twoyears. In April 2012 the share was at Rs 930 which scaled up to Rs 1794 in the second week of this month.A cursory look at its performance reveals that in April 2012 the stock hit a 52-week high with its value soaring up to Rs 930.Notably, the bank’s share first time crossed Rs 1000 mark on January 2, 2008. In October 2010 the bank’s stock was recorded around Rs 860.On March 11, 2014, its price crossed Rs 1550 mark. In 2013 it breached Rs 1400 mark. The earnings per share jumped to Rs 59.70 which was up (YoY) by 35.77 percent from Rs 43.97 recorded during the corresponding period of the previous year.To mention, JK Bank was incorporated in 1938, and is listed on Indian bourses, NSEand BSE. The bank has a track record of uninterrupted profits and dividends for four decades.The bank is rated P1+, indicating the highest degree of safety by Standard & Poor and CRISIL.Analysts tracking the stock relate its phenomenal performance to the strong fundamentals of the bank and to the fact that the bank has been able to position itself uniquely in the Indian Banking sector.For last couple of years, the bank has realigned its business strategy by focusing on J&K state operations and developing a slew of financial products to cater to grossly under-serviced local economy.This strategy has proved very successful and the bank has considerably increased its lending portfolio in the state. Foreign Institutional investors have been showing the overwhelming interest in the Bank. Some of the biggest names in the world have invested in the Bank.Angel Brokings research report says: “Higher loan growth outlook, increase in CD ratio and shift in loan mix towards higher yielding advances are likely to provide near-term higher momentum to net interest income (NII) growth for the bank relative to other mid-sized banks. The bank also has a higher CASA ratio, strong capital adequacy and robust provision coverage, much higher than most other mid-sized banks. At the CMP, the stock is trading at a higher end as compared to its peers, which appropriately factors in its better asset quality performance vis-à-vis peers even in a challenging macro environment.”
Posted on: Sat, 09 Aug 2014 03:49:47 +0000
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