Canara Bank, in its recent quarterly report, has projected a slightly lower net interest margin (NIM) for the financial years 2024 and 2025. The bank's current NIM stands at a stable 3.02%, experiencing a slight dip of 3 basis points. Despite the predicted decrease, the bank expects this to be offset by higher other income and reduced slippages.
In addition to this, Canara Bank's second half NIM outlook is estimated around 2.9%. The bank's other income has seen an increase due to the recovery of previously written-off accounts.
The quarterly report also highlighted a healthy loan growth of 4% quarter-on-quarter. This was primarily led by a 6% rise in agricultural loans and a 4% growth in retail and small and medium-sized enterprise (SME) loans.
The bank has managed to reduce its gross non-performing assets by 40 basis points, indicating an improvement in its asset quality.
Despite certain constraints preventing a stronger stance on the stock, Canara Bank continues to maintain an 'Accumulate' stance with a target price of Rs 410, equivalent to one time its adjusted book value.
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