These days there is some reason for the shares of the banks on the broker's path. Banks are likely to reduce the NPA. Banks expect good growth in earnings. With this, analysts and investors are betting on the shares of the banks. They are seeing more value in Indian banks compared to foreign banks.
There is also a name in banking shares which has made the journey to become the most expensive banking stock with very low value shares. The name of the private sector bank is Axis Bank.
The price-to-earning ratio of shares of Axis Bank (P / E) is 200 times, which makes it the most expensive banking stock. For ICICI Bank, Kotak Mahindra Bank, HDFC Bank and Yes Bank, this figure is 75.30 times 55.60 times, 31.60 times and 14.50 times.
According to information from Reuters, 14 analysts are advising to buy Axis Bank. 7 Holding and only 2 analysts are advising to sell it. 17 analysts believe that Axis Bank's stock will perform well. 3 analysts are susceptible to its weak performance.
This is the choice of both share fund managers and analysts. According to data for February 2019, 462 schemes of 36 fund houses have a stake in this bank. Most analysts believe that Axis Bank can disappoint investors at current valuation.
Mr. Amar Ambani, president and research head of Yes Securities, believes that the valuation of Axis Bank is completely reasonable. He believes that the full picture of Axis Bank's profits could not come up.
He said, "Do not pay much attention to PE, due to over provisioning, the profits are low, on the basis of price-to-book value, the share is on the right value, compared to HDFC Bank and Kotak Mahindra Bank, it is at a discount. Investors should also look at institutional changes associated with this bank."
On April 2, Axis Bank's price-to-book value was 3 times, while Kotak Mahindra Bank and HDFC Bank were 6.2 times and 4.4 times respectively. For ICICI Bank this level was 2.5 times. "In this case, we consider ICICI Bank as the most economical," said Ambani.
Since October, Axis Bank has jumped 32%, while the Sensex has risen 13% during this period. Its PE value was 162 times as on December 31 last year, but on April 2, it has reached 200. But the question arises that what is the reason for its so much valuation
Axis Bank has significantly improved its asset quality. In FY18, its NPA dropped from 6.8 per cent to 5.8 per cent in the December quarter. It is expected to improve further in the coming time.
Brokerage firm Stockkhana said, "Curtailed NPA and rising profits are good news for the bank, as well as improvements in management and improvement in debt and risk structure is good news for the bank." JM Financial has advised to buy this bank with target price of 865 rupees.
The bank has recently assessed its focus area for the next three years. It has also set a target of 18 percent return on asset (ROE) in the medium term. In order to achieve this goal, the bank will have to improve four things. For this, Axis Bank has to cut the cost of loan, better margins, increase in fees and costs incurred on cost. The bank has a special focus on growth, profitability and regular performance. Kotak Institutional Equities also believe in this bank.
For more information Top 10 Stock Advisory Company Indore
There is also a name in banking shares which has made the journey to become the most expensive banking stock with very low value shares. The name of the private sector bank is Axis Bank.
The price-to-earning ratio of shares of Axis Bank (P / E) is 200 times, which makes it the most expensive banking stock. For ICICI Bank, Kotak Mahindra Bank, HDFC Bank and Yes Bank, this figure is 75.30 times 55.60 times, 31.60 times and 14.50 times.
According to information from Reuters, 14 analysts are advising to buy Axis Bank. 7 Holding and only 2 analysts are advising to sell it. 17 analysts believe that Axis Bank's stock will perform well. 3 analysts are susceptible to its weak performance.
This is the choice of both share fund managers and analysts. According to data for February 2019, 462 schemes of 36 fund houses have a stake in this bank. Most analysts believe that Axis Bank can disappoint investors at current valuation.
Mr. Amar Ambani, president and research head of Yes Securities, believes that the valuation of Axis Bank is completely reasonable. He believes that the full picture of Axis Bank's profits could not come up.
He said, "Do not pay much attention to PE, due to over provisioning, the profits are low, on the basis of price-to-book value, the share is on the right value, compared to HDFC Bank and Kotak Mahindra Bank, it is at a discount. Investors should also look at institutional changes associated with this bank."
On April 2, Axis Bank's price-to-book value was 3 times, while Kotak Mahindra Bank and HDFC Bank were 6.2 times and 4.4 times respectively. For ICICI Bank this level was 2.5 times. "In this case, we consider ICICI Bank as the most economical," said Ambani.
Since October, Axis Bank has jumped 32%, while the Sensex has risen 13% during this period. Its PE value was 162 times as on December 31 last year, but on April 2, it has reached 200. But the question arises that what is the reason for its so much valuation
Axis Bank has significantly improved its asset quality. In FY18, its NPA dropped from 6.8 per cent to 5.8 per cent in the December quarter. It is expected to improve further in the coming time.
Brokerage firm Stockkhana said, "Curtailed NPA and rising profits are good news for the bank, as well as improvements in management and improvement in debt and risk structure is good news for the bank." JM Financial has advised to buy this bank with target price of 865 rupees.
The bank has recently assessed its focus area for the next three years. It has also set a target of 18 percent return on asset (ROE) in the medium term. In order to achieve this goal, the bank will have to improve four things. For this, Axis Bank has to cut the cost of loan, better margins, increase in fees and costs incurred on cost. The bank has a special focus on growth, profitability and regular performance. Kotak Institutional Equities also believe in this bank.
For more information Top 10 Stock Advisory Company Indore
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