Bank of Baroda Q2 results preview: Analysts expect weak earnings for Q2FY26 due to margin pressure, muted treasury income, and lower profitability. NIM and PPoP likely to decline sequentially.
State-run banks, SBI, Uco bank, PSB among others gained up to 2% amid reports that India may considering allowing up to 49% FDI in PSU banks, more than double the current 20% cap.
Nifty Bank index hit an intra-day high of 57,458.85 on the NSE, and was just 170-odd points shy from it's all-time high level of 57,628.40 registered on July 2, 2025.
SBI, Uco Bank, Punjab & Sind Bank, Indian Overseas Bank, Central Bank of India, PNB and Canara Bank were up in the range of 2 per cent to 5 per cent in Friday's intra-day trade.
Credit costs may also weigh on margins, given the stress in the unsecured loan book, bankers said
"BoB is currently anchoring CBDC initiatives in collaboration with the Reserve Bank of India," he said. RBI is currently conducting pilot projects on CBDC
Bank of Baroda stock rallied after the bank reported a healthy business growth in Q2FY26 with global advances at ₹12.79 trn, up 11.9% YoY, while global deposits stood at ₹15 trillion, up 9.3% YoY.
Bank of Baroda is displaying constructive price action as it consolidates near the upper band of its recent range while holding firmly above key moving averages.
Despite a nearly 5x jump in aggregate mcap since FY20, most coverage PSBs still trade at reasonable valuations of 0.8-1x forward P/B & 5-7x FY27E EPS, leaving room for further upside.
In the past one month, the Nifty PSU Bank index has outperformed the market by surging 8 per cent, as compared to less than 1 per cent rise in the Nifty 50.
Systematix noted that PSBs witnessed a remarkable turnaround in FY25, reversing the decade-long decline in their advances market share
Thus far in the month of September, Nifty PSU Bank index has outperformed by surging 7.5 per cent, as compared to 3.7 per cent rise in the Nifty 50.
PSU banks rally 21% in 6 months, outpacing private lenders. Experts say strong earnings and credit growth fuelled the surge. Time to rebalance portfolio? Find out investment strategy in bank stocks
S&P Market Intelligence expects Indian banks' dividend pay-outs to decline 4.2% in FY26 as margins and profits weaken, with HDFC Bank and Bank of Baroda set to cut dividends
PSU Bank stocks gained up to 2% in trade on Thursday; Nifty PSU Bank index hit an intra-day high of 7,142.25, and was 2.3 per cent away from its 52-week high of 7,304.80 touched on July 17, 2025.
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Firms are focusing on paying down debt, opting for refinancing rather than expanding capacity, Shankar Subramaniam, the bank's head of India corporate banking said
Lenders are improving asset quality but they are struggling to recover money
Shares of PSU banks have rallied up to 24% thus far in FY26; here's what technical charts suggest for Bank of India, Indian Bank, Bank of Baroda, PSB and Central Bank of India.
Public sector banks saw Q1 FY26 profit rise 10.6% YoY on treasury gains and lower provisions, while NII was flat as lenders passed on policy rate cuts to customers