The share price of Karur Vysya Bank gushed at around 15 percent and ICICI Bank fostered confidence in the share and anticipated the share to surge by 51 percent. ICICI Bank has set the share price at Rs 74 which is 51 percent higher than the current share price of Rs 49.10. The brokerage on the Karur Vysya Bank share price has risen incorporating a few factors such as improving stake on the return on Assets recovery ratio that inhibits the profitability of the bank and the continuing improvements being made by the bank in order even after the change in management and favourable risk-reward. Return of assets will touch 0.9 percent by the Financial year 2022 that inhibits strong pricing power and ability to control costs.
Karur Vysya Bank has hit its lowest price of Rs 18.75 and highest of Rs 61.70 leading to a plunge of around 19% in the share price over the past one year. Karur Vysya Bank has also launched Neo Banking in order to align the commercial and the corporate sectors and they have been actively calibrating their portfolio mix by reducing corporate exposure, building infrastructure to expand its retail sector, and aligning both corporate and commercial sectors to focus on both the segments.
A stronger provision coverage ratio of around 64 percent would ensure credit cost moderation and would ensure if banks are a safe place to invest your money. As there is an interim stake due to Covid 19 but gauged growth over the year and recent trends suggest that gradational NPA’s and restructured loans would be within limits and is unlikely to dip balance sheet quality at all.
Strong confidence is still placed in the Karur Vysya Bank and is expected to be well placed in terms of the return on the assets and be well placed in the near future showing steady improvement.