RBL Bank drops over 5% post q1 earnings, BEL shares hit 52-week high: What should investors do?

Global brokerage houses have come out with their reports on RBL Bank, which announced its result for Q1FY 23, and PSU counter Bharat Electronics Limited (BEL). The private lender on Thursday reported a consolidated net profit of Rs 208.66 crore in the June quarter as against a loss of Rs 462.25 crore in the same period a year ago. The PSU that caters to aerospace and defence space has seen a decline in profit by 62% sequentially in the results announced last week.  

On Friday, shares of RBL Bank declined more than five and half per cent to Rs 89.55, while BEL stock gained around one per cent to trade on 52-week high value of Rs 270 per share on the BSE.  

Brokerages on RBL Bank 

Global brokerage houses were largely bearish on the RBL Bank and were seen downgrading the counter with reduced target prices.  Bank of America (BoFA) maintained an underperform rating with an old target price of Rs 110.  

Credit Suisse gave an underperform rating with a reduced target price of Rs86 against Rs 95 earlier. Giving a neutral call on RBL Bank, JP Morgan slashed the target price of the stock from Rs 110 to Rs 105.  

Brokerages on BEL 

On the contrary, brokerage house remained bullish on the defence stock.  

Jefferies maintained a buy call on BEL with an increased target price of Rs 310, previously Rs 280.  

CITI and Morgan Stanley maintained the old target price of Rs 296 and Rs 260. The former maintained a buy, while the latter retained an overweight rating on the counter.  

Sying that BEL has maintained a strong outlook, domestic brokerage house ICICI Securities gave a 'Buy' on the stock with a revised target price of Rs 316/share (Rs300 earlier). 

Earlier, RBL Bank had reported a net profit of Rs 164.77 crore in the preceding March quarter. On a standalone basis, its post tax profit came at Rs 201.16 crore for the reporting quarter. 
Its core net interest income increased by 6 per cent to Rs 1,028 crore on a 7 per cent growth in advances and the Net Interest Margin (NIM) being at the stable 4.36 per cent.