Bandhan Bank’s shares surged over 12% after the RBI approved Partha Pratim Sengupta as the new Managing Director and CEO. He accepted the position on October 9, 2024, and confirmed on October 10 that he would resign from other roles to comply with RBI’s terms. His three-year term is expected to begin by November 10, pending final approval from the bank’s Nomination and Remuneration Committee. As of 9:30 a.m., Bandhan Bank shares closed at Rs 210.26, a 12% increase from the previous session’s close.
Brokerages maintained a positive outlook on the recent developments at Bandhan Bank, suggesting that all near-term concerns related to the stock have been addressed. This optimism contributed to the stock’s surge following the appointment of the new MD and CEO, Partha Pratim Sengupta, and the RBI’s approval of his leadership.
Bandhan Bank announced that the National Credit Guarantee Trustee Company (NCGTC) has conducted a thorough forensic audit of its claims under the Credit Guarantee Fund for Micro Units (CGFMU) scheme. By March 31, 2024, the total payout assessed stands at Rs 1,231.29 crore.
According to Bandhan Bank’s statement, the bank had previously received Rs 916.61 crore in December 2022. Following the completion of the forensic audit, the final payout as of March 2024 amounts to Rs 314.68 crore. This settlement is part of the claims under the Credit Guarantee Fund for Micro Units (CGFMU) scheme.
International brokerage Jefferies has retained its “buy” rating on Bandhan Bank, setting a target price of Rs 240 per share. The firm views the appointment of Partha Sengupta as the new Managing Director and CEO as a significant positive development for the bank’s future.
Sengupta’s extensive experience in West Bengal, a key market for Bandhan Bank, is anticipated to enhance the bank’s position. Moreover, the bank is poised to receive Rs 320 crore from a CGFMU claim, along with Rs 230 crore in recoveries, which will contribute positively to its profitability and overall credibility.
With past challenges addressed and appealing valuations at 1.1 times FY26 adjusted price-to-book, Jefferies encourages investors to maintain a “buy” position on Bandhan Bank stock. The firm believes these factors, combined with recent developments, present a strong opportunity for growth.
Goldman Sachs highlighted that the appointment of a new MD and CEO, along with the resolution of the CGFMU claim, alleviates all near-term concerns for Bandhan Bank. With investor uncertainty about business continuity now resolved, the focus shifts to the bank’s fundamentals, suggesting potential for growth under the new management.
