PSU banks stocks rally; SBI hits six-week high, Canara Bank shares soar 6%

By: | Published: July 26, 2018 12:06 PM

PSU banks stocks traded with substantial gains in mid-morning trade on Thursday, with State Bank of India stocks rising 5.1% to nearly six-week high at Rs 285.70 on the NSE.

PSU banks stocks traded with substantial gains in mid-morning trade on Thursday.

PSU banks stocks traded with substantial gains in mid-morning trade on Thursday, with State Bank of India stocks rising 5.1% to nearly six-week high at Rs 285.70 on the NSE. Meanwhile, the Indian stock markets extended gains on Thursday with BSE Sensex and NSE Nifty hitting fresh all-time highs at 37,026.18 and at 11,179.60, respectively, following sharp gains in SBI share price. Canara Bank shares soared 6% to over 6-week high on positive Q1 results.

Also read: Share Market Live! Sensex, Nifty hit all-time high; SBI up 5%

Shares of the state-run bank SBI rose for the eighth straight session, marking their longest rally since April 2013. Along with SBI, gains in shares of Canara Bank (5.17%), Indian Bank (4.34%), Bank of Baroda (4.17%), Punjab National Bank (2.40%) and Syndicate Bank (4.04%) among other PSU banks drove the NSE PSU Bank index higher. The rally in the PSU banks shares was fuelled by a report by global credit ratings agency Moody’s which said the government’s plan to infuse Rs 11,336 crore in five state-owned banks is “credit positive”.

Canara Bank shares soared 6.4% to over 6-week high of Rs 275.50 on the NSE after the public sector bank reported an 11.87% rise in net profit of Rs 281.49 crore in the first quarter ended June 30. Making basic changes in business portfolio and doing organisational restructuring helped the bank give good results, PTI quoted CEO and MD Rakesh Sharma as saying. In asset quality terms, the gross non-performing assets (NPAs) of the bank increased to 11.05% of gross advances at the end of June 2018, as against 10.56% as of June 30 last year.

On Wednesday, Moody’s in a report said the government’s plan to infuse Rs 11,336 crore in five state-owned banks — including scam-hit PNB, Andhra Bank, Allahabad Bank, Corporation Bank and Indian Overseas Bank — is credit positive and will help these lenders meet the regulatory requirement. “The infusions are credit positive and will strengthen the banks’ capitalisation,” PTI reported quoting Moody’s report.

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