Allahabad Bank has invited initial bids from asset reconstruction companies, banks, and non-banking finance companies for the proposed sale of 61 non-performing assets worth Rs 1,250 Cr.
Bidders have to complete due diligence on these loans by Dec 1, and the last date of submission of bids is Dec 4, the lender said in a notice on its website.
This is positive news for the company as this will help the company to reduce its stress assets.
We expect NIMs to remain below the 2.7% over FY18-19E. The stock trades cheap at 0.42x FY17 P/BV.
Allahabad Bank ended at Rs 76.9, down by Rs 0.7 or 0.9% from its previous closing of Rs 77.6 on the BSE. The scrip had opened at Rs 77.6 and has touched a high and low of Rs 78.45 and Rs 76.75 respectively. The stock is currently trading above its 200 DMA.
Allahabad Bank (ALBK) is a nationalized bank with its headquarters in Kolkata. Its loan mix for FY17 is comprised of Corporate-26.9%, Agri-17.1%, MSME-19.7%, retail -10.8% and others 31.4%. Its FY17 CET1 stood at 11.6% while asset quality remained weak with 13.9% GNPAs and 8.9% NNPAs.
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