Shares of Bandhan Bank rose 9% today.

Shares of Bandhan Bank rose over 9 per cent in the Friday trading session after the Reserve Bank of India (RBI) approved the appointment of Partha Pratim Senagupta as MD & CEO of the private lender. The company made the announcement via an exchange filing after market hours on Wednesday. 

The RBI has earlier granted permission to Partha Pratim Sengupta to appoint him as Managing Director and Chief Executive Officer of the bank for three years from the date of his assumption of office, not later than November 10, 2024, the lender said in its exchange filing.

Partha Pratim Sengupta is an experienced banker with nearly four decades of experience in the banking industry. He has worked in a variety of settings, in retail and corporate banking. He has also served as deputy director and chief credit officer of the bank’s State Bank of India (SBI). He then took up the post of Managing Director & CEO of Indian Foreign Bank.

Shares of Bandhan Bank Ltd rose 9.15% to Rs 204.90 on Friday, taking the total market capitalization above Rs 33,000 crore. The scrip settled at Rs 187.75 in the previous trading session. However, the stock rose 10%  in six months, compared with an annual decline of 18%.

Kotak Institutional Equities has a 'buy' rating on the stock with a target price of Rs 250. Nirmal Bang and Nuwama Institutional Equities have a 'hold' rating with a target price of Rs 200 and Rs 242 on Bandhan Bank. On the other hand, EmK Global Financial Services had a ‘reduce’ rating on the stock with a target price of Rs 175.

Following the announcement, CLSA said the focus will now return to basics because the big overhang has gone. "The near-term crime prospects for MFIs are benign but most of this is already in the estimates and prices," he added, anticipating reassessment of recruitment of additional staff and stock up. The stock has an Outperform rating with a target price of Rs 200.

In another exchange filing, Bandhan Bank said the National Credit Guarantee Trustee Company (NCGTC) has completed a detailed forensic audit of the claims filed by the bank under the Micro Units Credit Guarantee Fund (CGFMU) scheme, and assessed it that the total outstanding amount of 1,231.29 crore of Rs.

Bandhan Bank had already created and received Rs 916.61 crore by December 2022 of the aforementioned amount from NCGTC. Considering that the first premium has been extended by Rs 916.61 crore, the final payment by March 31, 2024 is Rs 314.68 crore, Bandhan Bank said in a statement.

Leadership clarity should refocus on the fund’s origins and strategic directions going forward. While microfinance as a space is under asset quality pressure, we believe Bond Bank grew meaningfully slower than the rest of the industry this cycle which should reduce the upward pressure, JM Financial Services said.

"We will look at our figures after Q2FY25 results. The stock is currently trading at a cheap price of 1.0 times FY26e P/BV and offers an attractive risk-reward in our view, it added while holding 'buy." ' with a target price of Rs 260."

Another foreign trader, Jefferies, said the new CEO of Bandhan Bank brings a strong background and quality assets that are expected to outperform other MFIs, despite some risks in FY25. With a target price of Rs 240 and a buy rating, the brokerage said the CGFMU recovery adds confidence.

Goldman Sachs said the MD & CEO appointments and CGFMU settlements address near-term concerns and investor skepticism about progress following changes in business development management. itIn another exchange filing, Bandhan Bank said the National Credit Guarantee Trustee Company (NCGTC) has completed a detailed forensic audit of the claims filed by the bank under the Micro Units Credit Guarantee Fund (CGFMU) scheme, and assessed it that the total outstanding amount of 1,231.29 crore of Rs.

Bandhan Bank had already created and received Rs 916.61 crore by December 2022 of the aforementioned amount from NCGTC. Considering that the first premium has been extended by Rs 916.61 crore, the final payment by March 31, 2024 is Rs 314.68 crore, Bandhan Bank said in a statement.

Leadership clarity should refocus on the fund’s origins and strategic directions going forward. While microfinance as a space is under asset quality pressure, we believe Bond Bank grew meaningfully slower than the rest of the industry this cycle which should reduce the upward pressure, JM Financial Services said.

"We will look at our figures after Q2FY25 results. The stock is currently trading at a cheap price of 1.0 times FY26e P/BV and offers an attractive risk-reward in our view, it added while holding 'buy." ' with a target price of Rs 260."

Another foreign trader, Jefferies, said the new CEO of Bandhan Bank brings a strong backgrund and quality assets that are expected to outperform other MFIs, despite some risks in FY25. With a target price of Rs 240 and a buy rating, the brokerage said the CGFMU recovery adds confidence.

Goldman Sachs said the appointment of MD & CEO and settlement of CGFMU issues removes imminent concerns and investor skepticism about growth following changes in performance management. it