Target: ₹88

CMP: ₹80.16

Bank of Maharashtra reported Q4FY26 PAT of ₹2,010 crore, (12.3 per cent above our estimate of ₹1,790 crore) up 13.2 per cent quarter on quarter and 34.9 per cent year on year. The sequential improvement was driven by healthy net interest income (NII) growth, lower provisions. The bank reported a healthy sequential growth in net advances of 6.9 per cent in Q4 and 22 per cent year on year, while the deposits grew 9 per cent and 14.1 per cent correspondingly.

The net interest margin (NIM) improved 5 bps sequentially (down 9 bps year on year). The yield on advances declined 20 bps quarter on quarter to 8.72 per cent.  The management indicated that deposit repricing benefits are largely captured and have guided for a NIM of about 3.75 per cent, going forward. Gross slippages stood at ₹840 crore, while the annualised gross slippage ratio was 1.2 per cent. The recoveries and upgrades stood at ₹340 crore. This resulted in a net slippage addition of ₹500 crore.   The slippages are expected to remain below 1 per cent levels, while the credit costs are expected to stabilise at 1 per cent, going forward.

Further, the advances are expected to grow 18 per cent and deposits 14-15 per cent while maintaining CASA at about 50 per cent levels. Based on our revised estimates, we have revised our target price to ₹88 (from ₹80 earlier) and maintain our BUY rating on Bank of Maharashtra. We are valuing the standalone bank at 1.5x its FY28E adjusted book value per share of ₹58.

Published on April 21, 2026