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Corporation Bank – BUY (Target Price Rs492, Upside 12.3%)
India Infoline Research Team / 16:12 , Feb 04, 2010

Corporation Bank is a mid-sized PSU bank with a total asset base of ~Rs870bn (end FY09). The bank was established in 1906 and currently operates 1,094 branches and 1,057 ATM’s, ~75% of which are located in South & West India. Return ratios for the bank have remained attractive (RoE ~20% and RoA ~1.2%) on the back of steady rise in net profit and zero equity dilution. With loan growth running high at 26% yoy we expect the book to witness 20% CAGR over FY09-11E, translating into a 19% CAGR in net profit. Using our proprietary Bank 20 valuation model, we assign a multiple of 1.1x to Corporation Bank’s FY11 adjusted BV and arrive at 1-year price target of Rs492. Comfortable asset quality coupled with improvement in margins and CASA ratio is likely to command premium valuation. Maintain BUY.
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nifty
By nirav, March 22, 2010 13:07
nifty trg 5280
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nifty
By debasis, March 22, 2010 10:16
nifty bullis view
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NIFTY
By deepak, March 21, 2010 22:29
nifty to correct 2 to 3% in short term
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NIFTY
By chandrasekaran, March 21, 2010 10:47
yes mostly
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by nifty
By alok, March 20, 2010 14:22
5350
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