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Rakesh Jhunjhunwala Portfolio: Motilal Oswal bullish on this bank; sees over 35% upside 

Rakesh Jhunjhunwala Portfolio: Motilal Oswal bullish on this bank; sees over 35% upside 

Total income of the bank in the January-March period of 2021-22 rose to Rs 22,323.11 crore, from Rs 21,040.63 crore in the same period of 2020-21, Canara Bank said in a regulatory filing. 

Rakesh Jhunjhunwala Portfolio: Motilal Oswal bullish on this bank; sees over 35% upside  Rakesh Jhunjhunwala Portfolio: Motilal Oswal bullish on this bank; sees over 35% upside 

Brokerage house Motilal Oswal has maintained its bullish stance on Bengaluru-headquartered Canara Bank, a part of Big Bull's portfolio. It has a 'Buy' rating on the stock with a target price of Rs 280 (premised on 0.8x FY24E ABV), implying over 35 per cent upside potential. 

On Tuesday, the scrip opened a tad lower at Rs 200.70 against the previous close of Rs 201.45. At 10:35 hours, the shares were trading 1.3 per cent higher at Rs 204.05 on BSE. Market cap of the bank rose to Rs 37,044.54 crore. 

Motilal Oswal said that Canara Bank reported a stable operating performance supported by healthy margins, modest loan growth and strong asset quality. 

It noted that while corporate book saw a small decline, the bank has continued to grow the RAM segment at a steady pace with contributions from all segments. 

"Despite elevated slippages, asset quality ratios improved further underpinned by higher recoveries and upgrades. Declines in SMA overdue and restructured portfolios provide incremental comfort on asset quality trends. We estimate an RoA/RoE of 0.7 per cent/13 per cent by FY24," it added. 

State-owned Canara Bank reported a 65 percent jump in its standalone net profit at Rs 1,666.22 crore for the quarter ended March 2022. The bank had posted a net profit of Rs 1,010.87 crore in the same quarter a year ago. 

Total income of the bank in the January-March period of 2021-22 rose to Rs 22,323.11 crore, from Rs 21,040.63 crore in the same period of 2020-21, Canara Bank said in a regulatory filing. 

On the asset quality front, the bank's gross non-performing assets (NPAs) or bad loans fell to 7.51 percent of the gross advances at the end of March 2022, as against 8.93 percent at the end of March 2021. 

Net NPAs also fell to 2.65 percent in the quarter under review, from 3.82 percent (Rs 24,442.07 crore). 

India's ace investor and Dalal Street veteran, Rakesh Jhunjhunwala has increased his stake in Canara Bank to 2 per cent from 1.6 per cent. As per the December quarter shareholding pattern, Jhunjhunwala held 1.6 per cent stake or 2,90,97,400 shares of the bank.