PNB Stock Dives 10% on Flop Q4: Weighs Nifty PSU Bank Down, Index Tanks 4%

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PNB Stock Dives 10% on Flop Q4: Weighs Nifty PSU Bank Down, Index Tanks 4%
Credit: © Reuters.

By Malvika Gurung -- Shares of the public sector lender Punjab National Bank (NS: PNBK ) tanked 10% to Rs 29.8 at the time of writing, and hit a fresh 52-week low at Rs 29.5 apiece in early trade on Thursday.

PNB’s share slump has pulled indices Nifty Bank and Nifty PSU Bank down, falling 3.7% and 2.17% lower, respectively. Nifty PSU Bank is the worst sectoral performer in the Nifty basket.

The stock dived following a flop March earnings report released post-market hours on Wednesday, with standalone net profit declining 65.5% YoY to Rs 201.6 crore, far missing the Street’s estimate of Rs 1,388.1 crore in the quarter.

The profit declined due to a higher amount set aside for provisioning, even though the lender’s NPA levels in the quarter declined.

The lender’s total income reduced marginally by 1.36% YoY to Rs 21,095 crore, while NII climbed 5% YoY to Rs 7,305 crore in the March quarter.

In terms of asset quality, the country’s second-largest bank reported an improvement in Q4 FY22, as its gross NPA fell to 11.78% from 14.12% in Q4 FY21, and net NPA or bad loans declined to 4.8% from 5.73% earlier.

At the same time, however, PNB parked an over 37% YoY higher provision for bad loans and contingencies for the March quarter at Rs 4,851.47 crore in the quarter.

The bank’s board of directors has recommended a dividend of Re 0.64/share for FY22.

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