RBL Bank: Worst may be over, but near-term asset quality pressures seen

Renewed focus on MFI loans and credit cards should put the bank on growth trajectory after six quarters

Once the most sought-after bank stock, RBL Bank, went out of fashion in July 2019, when its financials first indicated asset quality stress. Over the last 18 months, its stock price has fallen by over 70 per cent. With gains of 52 per cent in the last three months, the bad spell appears to have ended, thanks to the re-rating wave that has engulfed the banking stock. That said, it remains a laggard on a longer horizon and with valuations at 1x FY22 estimated book, down over 58 per cent from all-time highs, the bank in its new avatar is