Mumbai: Due to robust credit growth, rising asset quality and low valuations, state-run banks such as UCO Bank, Canara Bank, Union Bank and Punjab National Bank touched their new 52-week highs in Tuesday's intraday trade, reported ET Markets. As per the news report, UCO Bank was the top gainer as it rallied over 14 percent to hit a fresh 52-week high of Rs 21.35. The stock also recorded its highest level in four years.
"The other three PSU bank stocks also hit their multi-year highs on Tuesday. Canara Bank hit its four-year high at Rs 317.25, while Union Bank of India touched its three-year high at Rs 78.30 and PNB hit a two-year high at Rs 48.40," reported ET Markets.
Global brokerage firm BofA Securities in a report said, "It expects the valuation discount between PSU banks and private sector banks to narrow further."
"Indian PSBs have been on the path of normalisation over the past few years and it all came together in Q2, to deliver the best RoA in the past eight years. PSB's loan/PPOP growth was almost at par with private banks," said Anand Swaminathan, BofA analyst, adding that the most comforting factor was the broad-based improvement in asset quality metrics.
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