Rekha Jhunjhunwala increases stake in this PSU bank in Q3; stock up 62% in 2022

However, Rakesh passed away on August 14, 2022. But his estate including shares and property is passed on to his family. His wife Rekha Jhunjhunwala has been diversifying his and her stock portfolios since then.

During Q3FY23, as per the regulatory filing, Rekha Jhunjhunwala’s shareholding in Canara Bank stood at 3,75,97,600 equity shares or 2.07%. This is an increase of 0.59% in her stakes in Canara Bank compared to the September 2022 quarter where shareholding stood at 1.48%.

As per Trendlyne data, during the third quarter of FY23, Jhunjhunwala’s net worth in stocks increased marginally to ₹33,230.35 crore. So far in January 2023, the wealth is around ₹33,061.17 crore. Titan, Star Health and Allied Insurance, Metro Brands, Tata Motors, and Canara Bank are the top 5 stocks in Jhunjhunwala’s portfolio in terms of value.

On Friday, Canara Bank stock finished at ₹320.35 apiece down by 2.18% on BSE. The bank’s market cap is around ₹58,115.66 crore. Due to the bearish market tone, Canara Bank shares dipped nearly 5% in the week from January 2nd to 6th which is the first week of 2023.

However, in 2022, Canara Bank’s share price witnessed a more than 62% upside on Dalal Street. The stock even touched a 52-week high of ₹341.60 apiece in December.

Canara Bank stock will be in focus ahead of its third quarter earnings for FY23.

In their Q3FY23 preview report, Kotak Institutional Equities on Canara Bank said, “We expect bank to report a strong growth of ~45% yoy in PPOP, driven by high base of costs, resulting in earnings growth of ~70% yoy. NIM is expected to expand marginally qoq driven by elevated competition for deposits.”

The brokerage’s report added, “We expect slippages at 1.8% , but the trend of GNPL decline continues due to high recoveries and upgradations. We expect discussion to focus on operating profit growth and its drivers given that asset quality has improved significantly for the bank. Provisions are likely to be lower qoq at ~1.5%, mainly towards improving PCR.”

Further, the brokerage has given an ‘Add’ recommendation in Canara Bank shares with a fair value of ₹340.

During Q2FY23, Canara Bank posted a growth of 89.42% in net profit to ₹2,525 crore from ₹1,333 crore in Q2FY22. Net interest income in Q2FY23 rose by 18.51%. Meanwhile, global business jumped by 13.89% yoy and gross advances climbed by 20% yoy. Retail credit increased by 12.52% yoy with housing loan climbing by 17.01% yoy. Gold loan jumped 32.86% with a portfolio amount of ₹1,08,794 crore. As of September 30, 2022, the gross NPA ratio reduced to 6.37% from 6.98% as of June 2022, and 7.51% as of March 2022.

Notably, as of September 30, 2022, Canara Bank has 9,722 branches, out of which 3,040 are rural, 2,748 semi-urban, 2,002 urban, and 1,932 metro along with 10,759 ATMs. The bank is also having 3 overseas branches in London, Dubai, and New York.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.