Bank of Maharashtra shares surge to 52-week high on strong Q2 update

Bank of Maharashtra (MAHABANK) shares soared to a 52-week high on Wednesday after the public sector lender reported a strong business update for the quarter ended September 30. The stock surged by as much as Rs 2.4, or 4.9 per cent, to Rs 51.9 apiece on BSE, surpassing an existing 52-week peak scaled the previous day. 

Earlier on Wednesday, Zee Business analyst Ashish Chaturvedi recommended buying Bank of Maharashtra shares for a price target of Rs 51.6 with a stop loss at Rs 49. 

In a regulatory filing post-market hours on Tuesday, Bank of Maharashtra said its total business grew 22.8 per cent on a year-on-year basis in the July-September period to a provisional Rs 4,22,419 crore, while deposits increased 22.2 per cent to Rs 2,39,306 crore. 

Its current account and savings account (CASA) deposits registered growth of 10.1 per cent to Rs 1,21,345 crore compared with the year-ago period. 

Bank of Maharashtra said its CASA ratio—which determines the proportion of current and savings deposits in a lender's total deposits—stood at 50.71 per cent as of September 30, 2023, as against 50.97 per cent three months ago, and 56.27 per cent at the end of the September quarter last year. 

A higher CASA ratio implies a lower cost of funds for lenders, and vice versa. While current accounts don't yield interest for the depositor, the rate of interest applicable to savings accounts is usually lower than the benchmark rates. 

The lender's gross advances rose 23.6 per cent on a year-on-year basis to Rs 1,83,113 crore, according to the business update. 

The bank's operational update for the three-month period comes days before India Inc is set to enter a fresh corporate earnings season. Bank of Maharashtra is yet to reveal the date on which it will announce its Q2 results.  

How Bank of Maharashtra fared in the April-June period (Q1)

Pune-based Bank of Maharashtra (BoM) reported a 95 per cent jump in net profit to Rs 882 crore for the first quarter of the current financial year, aided by improvements in its asset quality as well as interest income. Its total income for the three-month period expanded to Rs 5,417 crore, from Rs 3,774 crore a year ago, according to a regulatory filing.

The company's net interest income, a key measure of profitability for lenders, increased 38.8 per cent to Rs 2,340 crore.

Its gross non-performing assets (NPAs) as a percentage of total loans stood at 2.28 per cent and net bad loans stood at 0.24 per cent.

Bank of Maharashtra (MAHABANK) shares: Past performance

Bank of Maharashtra shares have rewarded investors with a return of 64 per cent so far in 2023, sharply outperforming a 6.7 per cent rise in the benchmark Nifty index.

The stock delivered a return of 59 per cent in 2022 as against the Nifty's 4.3 per cent. 

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