Two Large Cap Banking Stocks Trading Near 52-Week High Get Buy From Leading Broking Firms

India's two leading banks -Bank of Baroda (BoB) and HDFC Bank - get a 'Buy' recommendation from Motilal Oswal Financial Services & ICICI Direct. The broking firms assign Buy on the stocks with attractive prices, claims up to 27% gains from their current market price. Check below to know more:

Bank Of Baroda (BoB)

Given the target price of Rs 240 per share by the broking firm Motilal Oswal Financial Services, the stock is likely to give a decent upside of 27% from its current level.

The stock of BoB last traded at Rs 189.45 per share on BSE with high and low of Rs 193.95 and 187.65, respectively. The stock is trading 2.38% away from its 52-week high of Rs 193.95 per share. Its 52-week low is Rs 187.65 per share.

The stock has given 60.69% positive return in 1 year. In 2 and 3 years, it has given 127.29% and 291.02%, respectively. It has given 29.49% positive return.

"BOB reported a mixed quarter with healthy treasury gains offsetting the pressure on NII, thus enabling the bank to deliver annualized RoA/RoE of 1.1%/20.0%. Higher other income and lower opex thus drove earnings while margins witnessed a decline to 3.27%. Business growth was healthy at 21% YoY, aided by strong traction across segments while CASA mix moderated. Asset quality continues to improve with NNPA at 0.78%. A lower SMA book and controlled restructuring provided further comfort on asset quality," Motilal Oswal Financial Services said.

It added, "We largely maintain our earnings estimates and estimate FY25E RoA/ RoE at 1.2%/16.9%. We value the stock at INR240 (based on 1.1x FY25E ABV). We reiterate our BUY rating on the stock."

HDFC Bank

Leading broking firm ICICI Direct has picked HDFC Bank with a 'Buy' for a Target Price of Rs 2050 per share. The broking firm claims a potential upside of up to 25%, keeping the given target price and current market price in consideration.

HDFC Bank's stock closed at Rs 1651.55 per share on BSE with high and low of Rs 1663.50 and 1647.55, respectively. The stock is trading 6.43% away from its 52-week high. Its 52-week high is Rs 1757.80 per share and 52-week low is Rs 1365.05 per share.

The stock jumped 15.77% in 1 year, while in 1 years, it jumped 10.57%. It gave 58.19% return in 3 years, and 54.92% in 5 years.

"Historically, HDFC Bank has delivered consistent strong business growth coupled with superior return ratios. Post merger, integration and accretion of liabilities remain the focus area. Management is confident of pedalling growth to 17-18% with steady return ratio at 1.8-1.9% in FY24-25E, though we expect some volatility in near term," ICICI Direct said.

It added, "Valuing the merged entity on SOTP basis assigning 2.5x FY25E ABV for lending business (merged basis) and ₹ 144 for subsidiaries arriving at a target of ₹ 2050 per share. Maintain BUY rating on the stock."

Disclaimer - The stocks have been picked from the brokerage reports of Motilal Oswal Financial Services & ICICI Direct. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.