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Punjab National Bank falls 4% on Q1 results; should you buy, sell or hold?
At 12 PM, PNB's share price was trading 2 per cent lower at ₹105.9 per share on the NSE. In comparison, NSE Nifty50 was down 0.23 per cent at 24,797 levels. The market capitalisation of the company stood at ₹1.21 trillion. CATCH STOCK MARKET LATEST UPDATES TODAY LIVE
Punjab National Bank Q1 results
Punjab National Bank on Wednesday reported a standalone net profit of ₹1,675 crore for the quarter that ended on June 30, 2025 (Q1FY26), down 48.5 per cent from ₹3,252 crore in the year-ago period. Sequentially, the profit fell 63.3 per cent from ₹4,567 crore.
The public sector undertaking's (PSU) total income rose by 15.7 per cent to ₹37,232 crore from ₹32,166 crore in Q1FY25. Sequentially, the revenue saw a marginal increase of 1.4 per cent from ₹36,705.
The gross non-performing asset (GNPA) ratio of the bank fell to 3.78 per cent as of June 2025, from 4.98 per cent in the year-ago period. Meanwhile, the net non-performing asset (NNPA) came down to 0.38 per cent as compared to 0.6 per cent in Q1 FY25. The bank opted for the new tax regime, incurring a one-time charge of ₹3,324 crore.
Punjab National Bank Q1 results analysis: InCred
According to analysts at InCred Equities, PNB's Q1FY26 beat on adjusted profit was due to strong non-core income and lower credit costs, while the core performance missed owing to higher taxes.
Additionally, PNB has a few levers to offset margin compression over the next few years. The bank's balance sheet is strong and has optionality from non-core income pools, the brokerage said in a note.
InCred has maintained an 'Add' rating on the stock. "We raise our target price to ₹120 (11 per cent upside), implying 0.85x target multiple. The stock appears attractive at 0.75x FY27F BV," it said.
Motilal Oswal Financial Services (MOFSL)
According to MOFSL, PNB's transition to the new tax regime will be beneficial from the second quarter onwards, with the effective tax rate moderating to 25 per cent.
Net interest margins (NIMs) contracted 11 basis points Q-o-Q, though the bank expects improvement from the third quarter onwards. Analysts believe that PNB's business growth remained modest, with management guiding for 11-12 per cent growth for FY26. While asset quality improved sequentially, with slippages moderating, the SMA book increased to 0.15 per cent of domestic loans.
The brokerage has maintained a 'Buy' on the stock with a target price of ₹130.
About Punjab National Bank
Punjab National Bank (PNB) is a state-owned commercial bank located in New Delhi. It was founded in 1895 in Lahore. PNB is one of the leading commercial banks in India. They offer banking products, and also operate credit card and debit card business, bullion business, life and non-life insurance business, and gold coins and asset management business. It offers a wide array of business banking services, including trade finance, loans, and digital banking solutions. Further, PNB Gilts is one of the major players in the Debt Market and is a primary dealer.
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