3 days Ago
Despite a sharp recovery in some bank stocks in recent trading sessions, most lenders continue to trade below their year-ago valuations. According to a data analysis compiled by ET Bureau, factors such as slowing credit offtake, pressure on net interest margins (NIMs), and regulatory measures curbing unsecured loan exposure have weighed on investor sentiment. These challenges, combined with muted expectations for the March quarter earnings, have added to the cautious outlook for the banking sector.
As per ET’s analysis, 28 out of 31 listed banks are trading at lower trailing price-to-book (P/B) multiples compared with the same period last year. Notably, only a few large private lenders have managed to maintain or slightly improve their P/B ratios. Meanwhile, 22 out of 31 banks have also underperformed in terms of stock returns, leading to a sector-wide valuation rerating despite the BSE Bankex gaining nearly 11% over the past year.
HDFC Bank’s current market price (CMP) as of April 15, 2025, stands at Rs 1,864.9, marking a year-on-year gain of 23.6%.
The bank’s current price-to-book (P/B) ratio is 2.9, compared with 2.6 a year ago, making it one of the few lenders with an increase in valuation multiple.
ICICI Bank has recorded a CMP of Rs 1,349.4 with a 26.4% rise on a year-on-year basis.
Its current P/B stands at 3.3, up from 3.1 last year, reflecting a marginal improvement in valuation.
SBI is trading at Rs 763.3 per share, showing a 1.5% increase over the past year.
The current P/B ratio is 1.5, compared to 1.8 a year ago, indicating a decline in valuation multiple.
Kotak Mahindra Bank has a CMP of Rs 2,120.8, translating into a year-on-year gain of 18.1%.
The bank’s current P/B ratio is 2.9, down from 3 in the previous year. Axis Bank is currently trading at Rs 1,114.
1 with a 5.8% rise in CMP over the year. The P/B multiple has declined from 2.
2 a year ago to 1.9 as of April 15, 2025. Bank of Baroda’s stock is down 7.
7% year-on-year, with a CMP of Rs 235. The current P/B ratio stands at 0.9, compared to 1.
1 a year earlier. Punjab National Bank has seen its CMP decline by 24.6%, now trading at Rs 96.
6. Its P/B ratio has dropped to 0.9, from 1.
4 last year. Union Bank of India is trading at Rs 122.4, registering a 14.
5% drop in CMP over the year. The P/B has declined from 1.2 to 0.
9 during the same period. IDBI Bank has seen a 3.9% decline in stock price, with its CMP at Rs 80.
8. The current P/B ratio is 1.8, compared to 2.
2 a year ago. Canara Bank's CMP is now at Rs 92.6, marking a 20.
7% year-on-year decline. The bank’s P/B ratio has fallen to 0.9, from 1.
3 in the previous year. ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times).
