PNB Shares Closed in Red for Fifth Session: Q4 Profit Jumps 52%, but Guidance Weighs on Stock

Punjab National Bank continued its losing streak for the fifth straight session today despite the lender posted a 52% on year rise in net profit for the March quarter. The stock closed 0.5% lower on the National Stock Exchange as the lender signalled a slight contraction in net interest income for the ongoing financial year. Its interest income also increased 14% from the year-ago quarter.

The lender’s net interest income for the quarter under review increased 4% on year. Apart from healthy financials, the bank also reported an improvement in its asset quality as its gross non-performing assets fell 22% on year, while net NPAs fell 37% during the March quarter.

PNB’s return on assets also improved 25 basis points in the quarter to 1.02%. The bank recorded a 4% on-year growth in savings and current deposits each during the March quarter. The lender’s CASA share was 37.95% as of March, according to the press release. Term deposits also saw a robust 21.5% growth on a year-on-year basis.

The bank’s housing loan book recorded an over 18% on-year growth in the March quarter, while its vehicle loan book grew 25.5% on year during the period. The lender’s agriculture advances grew 14% over the year-ago quarter figures, while MSME advances rose 17% during the period.

For the ongoing financial year, growth in the lender’s operating profit is seen between 8% and 9% from the 10% to 12% growth seen in FY25. The bank also anticipated a tad higher credit cost for FY26. Credit costs for the year are seen below 0.5%, which is higher than the revised projection of 0.25% to 0.3% FY25.

PNB’s credit growth for FY26 is seen at 11-12%, while deposit growth is seen at 9-10%, similar to FY25, according to the bank’s investor presentation. However, the lender expects a slight slippage in its operating profit and net interest income growth along with net interest margin for FY26 from what was observed in FY25. Its FY26 operating profit growth is seen at 8-9%, lower than 10-12% observed ion FY25.

The bank expects its net interest income to grow just 7% in the ongoing financial year in comparison to around 10% growth seen in FY25. Further it also expects its NIM to slightly slip to 2.8-2.9% in FY26 from 2.9-3% in FY25.