PSU Bank index jumps around 2%, Bank of Baroda soars over 5% - Check what brokerage says

Surging most than its peers, Nifty PSU (Public Sector Unit) Bank jumped around two per cent intraday to touch 2515.6 level, led by Bank of Baroda and Indian Bank, each rising by over five and 2.5 per cent to Rs 86.20 and Rs 143.40 per share on the BSE intraday today in early trade. 

While other PSU Bank stocks such as Bank of Maharashtra sored over three per cent to Rs 27.30 per share, similarly, Union Bank of India and Punjab National Bank each surged by over two per cent to Rs 36.40 and Rs 42.35 per share on the BSE intraday in early trade today. 

While Indian Overseas Bank and Central Bank of India declined most out of 13 scrips on the Index. Both tumbled by over five and a half per cent each Rs 20.60 and Rs 21.75 per share intraday today. 

As both the benchmark indices Sensex and Nifty50 each fell by over half a per cent intraday today, all sectors are trading in the red, and PSU Bank erasing the gains made in a trade earlier today. The Index was trading flat but negative by 0.38 per cent at around 01:40 pm. 

As the PSBs index surge, Morgan Stanley pointed out that the FY22 will see a tussle between higher restructured loans and lower non-performing loans. It expects the credit cost of PSBs to be moderate in FY22, while the extent will depend on the duration of existing or new Covid-19 waves. 

Morgan Stanley mentioned that Bank of Baroda is best placed amongst Non-SBI state-owned banks, it upgrades BoB, India’s third-largest lender, to overweight and raised the target to Rs 110 per share. 

India’s largest lender and government-owned, SBI grew by around one and a half per cent to Rs 432.3 per share on Wednesday during early trade.