Bank of Maharashtra Slips From Highs After Q1 Results

Bank of Maharashtra shares fell from early highs on Friday despite strong Q1 profit growth, hitting a low of Rs 81.62 on NSE.

Here’s what happened. The bank’s net profit jumped 27% year on year to Rs 2,020 crore, up from Rs 1,593 crore a year ago, and its core income also grew at a healthy pace.

On paper, that’s a strong quarter. But investors zoomed in on a few softer spots buried in the details, and the stock gave up a chunk of its early gains as the day went on.

The main worry was slippages, which is simply the value of loans that turned bad during the quarter. These rose to Rs 888 crore, up from Rs 727 crore a year earlier and Rs 839 crore in the previous quarter.

The bank’s net interest margin, a measure of how profitably it lends money, also narrowed slightly to 3.79% from 3.91% in the March quarter.

Provisions, money set aside to cover potential loan losses, rose to Rs 840 crore from Rs 617 crore in the previous quarter. There was good news too.

The bank’s total business grew 19% year on year to over Rs 6.5 lakh crore, with deposits up 13% and advances up 27%. Asset quality overall stayed steady, with the bad loan ratio holding flat at 1.45%.

Much of the day’s early strength actually came from the broader PSU banking pack.

Shares across the sector had rallied earlier after Indian Bank posted strong results of its own, and Bank of Maharashtra rode that wave before cooling off on its own numbers.

The stock closed the session at Rs 84.25, up 2.73% for the day. It remains below its 52-week high of Rs 94.50, touched less than two weeks ago.

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