Multibagger banking stock hits 52-week high for two sessions post Q3 earnings; target price, stop loss and more

Shares of Bank of Maharashtra hit 52-week high in afternoon trade today amid weak sentiment in the broader market. The lender scaled the yearly high for the second time in three days after it reported earnings for the quarter ended December 2023. Bank of Maharashtra stock scaled a fresh high of Rs 52.61 rising 5.53% against the previous close of Rs 49.85 on BSE. Market cap of the bank rose to Rs 36,461 crore in Thursday’s trade. 

Total 120.56 lakh shares of the bank changed hands amounting to a turnover of Rs 61.10 crore. In a year, the stock rose 61.41% and gained 13.04% in 2024. The bank has a PE of 9.95 lower than the industry. The banking sector PE stands at 12.91.

On Tuesday (January 16), after the earnings were announced, the stock hit a 52-week high of Rs 52.22.

The public sector banking stock has delivered multibagger returns in period up to and beyond two years. The stock rose 150.73% in two years and gave 250% returns in three years.

Aditya Gaggar, Director of Progressive Shares said, “Bank of Maharashtra has given a breakout  from a continuation pattern known as the Symmetrical Triangle Formation. The price breakout was confirmed with a falling trendline breakout in RSI and an upsurge in volume. As per the pattern, the target comes to Rs 61.”

Mandar Bhojane, Equity Research Analyst, Choice Broking said, "Bank of Maharashtra is presently trading at Rs 50 levels, having recently witnessed a robust breakout above the Rs 48.50 levels, marked by a significant runaway gap. This breakout, accompanied by robust volumes, signifies substantial strength in the stock. Notably, the stock is comfortably trading above its short-term (20 Day), medium-term (50 Day), and long-term (200 Day) Exponential Moving Average (EMA) levels, reinforcing the bullish sentiment.”

Bhojane expects the stock to hit Rs 60 in the shor-term , with a stop loss of Rs 46.5.   

“Bank of Maharashtra has successfully breached a critical range between Rs 45 and Rs 48.5 levels, solidifying its upward trajectory. The lower boundary of this range aligns with the 50 Day EMA, providing a formidable support level at Rs 47.5. Additionally, the Stochastic RSI shows a positive crossover, further confirming the bullish sentiment. Considering these technical indicators and the current market conditions, it appears to be an opportune moment to consider buying Bank of Maharashtra at the current market price of Rs 50. A reasonable target for this trade could be set at Rs 60, with a recommended stop loss at Rs 46.5 to manage potential risks," added Bhojane.

Bank of Maharashtra shares have a one-year beta of 0.6, indicating very low volatility during the period. In terms of technicals, the relative strength index (RSI) of Bank of Maharashtra stands at 66.3, signaling it's trading neither in the overbought nor in the oversold zone.

Bank of Maharashtra shares are trading higher than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day,150 day and 200 day moving averages.

The lender reported a 33% rise in net profit for the quarter ended December 2023. Profit climbed to Rs 1,036 crore in Q3FY24 on Y-o-Y basis against Rs 775 crore in Q3FY23. It grew 12.58% on a sequential basis.

Operating profit of the lender grew 27.32% on Y-o-Y basis to Rs 2,012 crore for Q3FY24 against Rs 1,580 crore for Q3FY23. The operating profit rose 4.77% on a Q-o-Q basis.

Net interest income (NII) rose 24.56% on Y-o-Y basis to Rs 2,466 crore in Q3FY24 against Rs 1,980 crore for Q3FY23. NII climbed 1.39% on a Q-o-Q sequential basis.

Net revenue (net interest income plus other income) for Q3FY24 rose 20.05 % from Rs 2,620 crore in the December quarter to Rs 3,146 crore for Q3FY24.

Gross NPAs declined to 2.04% in the end of Q3 against 2.94 % for December 2022 quarter. Net NPAs fell to 0.22% in the last quarter against 0.47% as on December 31, 2022. Provision coverage ratio of the lender improved to 98.40% as on December 31 last year as against 97.18% as December 31, 2022.

 

Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as an investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

 

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