Shares of Bandhan Bank surged over seven percent in morning trade after the Reserve Bank of India gave its nod to Partha Pratim Sengupta, a senior official from the central bank, to assume the mantle of managing director and chief executive officer of the private bank.
Mr. Sengupta accepted the role on 9 October 2024 and, on the following day, confirmed that he would resign from his other commitments to satisfy the terms and conditions of RBI. His three-year term will start on November 10, 2024. The final appointment is subject to approval from the bank’s Nomination and Remuneration Committee.
At 9:30 AM, Bandhan Bank shares were trading at Rs 200.80 a share, up 7 percent from the previous session’s closing price on the NSE.
Bandhan Bank announced that NCGTC has concluded a comprehensive forensic audit of claims under the CGFMU scheme. The total assessed payout up to March 31, 2024, stands at Rs 1,231.29 crore. The lender had earlier received Rs 916.61 crore in December 2022. After settling this preliminary claim, the final payout up to March 2024 stands confirmed at Rs 314.68 crore, according to Bandhan Bank.
International brokerage Jefferies maintains a buy recommendation on Bandhan Bank, with a target price of Rs 240 per share. The firm views the appointment of Sengupta as a positive development that would strengthen the bank’s position in West Bengal, as the latter happens to be an important market for Bandhan Bank. Besides, the bank would get Rs 320 crores from the CGFMU claim and recoveries of Rs 230 crores that will bolster its profitability as well as credibility further.
Jefferies sees a go-ahead for buying stocks at attractive valuations at 1.1 times the FY26 adjusted price-to-book ratio after past challenges are resolved.
Goldman Sachs also mentioned that with the appointment of the new MD and CEO and settlement of the CGFMU claim, no near-term uncertainty is involved in the bank. Now, investors will be more concerned about Bandhan Bank’s fundamentals as the concentration on concerns over the sustainability of the business momentum with the change in the management has waded off.
