PSU bank stocks continue to bleed: 14 of 21 PSB shares hit 52-week low today

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Updated: Mar 07, 2018 3:19 PM

Nifty PSU Bank index has shed 18% value since February 14, when multi-billion rupees PNB-Nirav Modi LoU scam came to light. Punjab National Bank shares are down more than 40% since then. In today’s trade, two-thirds of PSU bank shares fell to their respective 52-week lows.

Amid the constituents of Nifty PSU Bank index, shares of Andhra Bank were the biggest loser by falling over 8% to a 52-week low of Rs 39 on NSE. (Image: Reuters)

PNB fraud: PSU bank stocks have been broadly crumbling since the day, 14 February 2018, when the multi-billion rupees PNB-Nirav Modi LoU scam came to light. Shares of the fraud-hit Punjab National Bank have lost over 40% since then while the benchmark Nifty PSU Bank index has tumbled about 18%. PSB (public sector bank) shares witnessed a major jolt in today’s session as 14 out of 21 listed PSU bank stocks hit their respective 52-week lows with scrips of heavyweight state-run bankers such as Bank of Baroda, Bank of India and Canara Bank. Out of the Nifty PSU Bank components, other than PNB, shares of Union Bank of India, Allahabad Bank and Oriental Bank of Commerce have faced a massive rot since 14 February. 

The stock of NPA-laden, scam-hit Punjab National Bank have faced several knee-jerk reactions in several trading sessions after the nation’s second-largest PSU bank PNB informed $1.77 billion (Rs 11,394 crore) worth of “fraudulent and unauthorised” transactions which happened to be the biggest banking scam in India with about $204 million (Rs 1,323 crore) added to the kitty in the last week of February. From that time, PNB has lost about Rs 16,000 crore in the market capitalisation with shares falling more than 40%. Shares of Punjab National Bank extended losses on Wednesday shedding nearly 4% as Sunil Mehta, MD & CEO, PNB appeared before the anti-fraud agency SFIO (Serious Fraud Investigation Office). Sunil Mehta was also summoned by SFIO, along with Chanda Kochhar and Shikha Sharma. The stock of PNB crashed 3.88% to a day’s low of Rs 94.05 on NSE. 

Also Read | PNB shares extend losses, dive nearly 4% as MD Sunil Mehta appears before anti-fraud agency

In today’s trade, shares of 14 out of the total 21 listed PSU banks hit their respective 52-week low. Amid the constituents of Nifty PSU Bank index, shares of Andhra Bank were the biggest loser by falling over 8% to a 52-week low of Rs 39.1 followed by stocks of Canara Bank (down 7.26%), Allahabad Bank (down 5.53%), IDBI Bank (down 4.06%), State Bank of India (down 3.64%), Bank of India (down 3.38%), Indian Bank (down 3.1%), Oriental Bank of Commerce (down 2.94%), Bank of Baroda (down 2.88%), PNB (down 2.45%), Syndicate Bank (down 1.69%), and Union Bank of India (down 1.24%). In the meantime, the Nifty PSU Bank index fell 3.44% at 2,835.35.

Amid the massive rot in PSU bank shares, we take a look at 52-week low prices of 21 listed PSBs.

Stock52-week low52-week low date
Bank of Baroda128.557 March 2018
Bank of India98.007 March 2018
Indian Overseas Bank18.207 March 2018
Allahabad Bank45.757 March 2018
Andhra Bank39.007 March 2018
Canara Bank242.257 March 2018
Oriental Bank of Commerce91.107 March 2018
Union Bank of India93.507 March 2018
United Bank of India12.507 March 2018
UCO Bank24.307 March 2018
Bank of Maharashtra14.307 March 2018
Central Bank of India62.657 March 2018
Dena Bank18.857 March 2018
Punjab & Sind Bank34.807 March 2018
Vijaya Bank53.006 March 2018
Punjab National Bank92.0028 February 2018
Corporation Bank29.5528 February 2018
Syndicate Bank54.2019 February 2018
State Bank of India241.1519 October 2017
IDBI Bank50.2014 August 2017
Indian Bank251.4519 April 2017

The diamond merchant Nirav Modi and Mehul Choksi (promoter of Gitanjali Gems) were alleged in the case of obtaining buyer’s credit from a number of domestic bankers situated outside India on the basis of LoU (Letters of Undertaking) issued by Punjab National Bank to Nirav Modi group companies by unauthorised channels and without following proper protocols. Since that time, almost all the PSU bank and companies related to Nirav Modi and Mehul Choksi have been on the radars of investigative agencies (ED, CBI & SFIO), the Reserve Bank of India and the government (Ministry of Finance). Following the probe into the multi-billion rupees scandal, many top officials have been named, called and summoned for questioning in connection with the Rs 12,700 crore.

Yesterday only, SFIO (Serious Fraud Investigation Office), an investigative arm of Ministry of Corporate Affairs, India had summoned top MD and CEOs including Sunil Mehta, Punjab National Bank; Chanda Kochhar, ICICI Bank; Shikha Sharma, Axis Bank. Following the news of summon being issued to top bankers of ICICI Bank and Axis Bank, a sharp drop was observed in the shares of ICICI Bank while the stock of Axis Bank didn’t react much to the news but fell in the late trades on Tuesday. Since today morning, shares of both ICICI Bank and Axis Bank were under pressure with ICICI Bank plunging more than 3% and Axis Bank plummeting nearly 2% at day’s low prices.

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