Shares of Punjab National Bank (PNB) were trading higher in early trade on Friday ahead of its financial results for the quarter ended June 30.
The scrip was trading 1.51 per cent up at Rs 67 at around 10.05 am (IST), while benchmark BSE Sensex was down 110 points, or 0.29 per cent, at 37,720 at around the same time.
Brokerage firm Prabhudas Lilladher believes that lender may report a net profit of Rs 382.70 crore for the June quarter against a loss of Rs 940.01 crore in the corresponding quarter last year.
However, it sees 4.20 per cent and 16.30 per cent year-on-year fall in net interest income (NII) and pre-provision operating profit in Q1FY20.
“PNB to continue to suffer from capital issues and hence loan growth could be muted, while other operating metrics are likely to be weak.
It has been able to post strong recovery or upgrades in FY19 which are also very crucial in FY20 to improve asset quality ratios and earnings improvement,” Prabhudas Lilladher said in a report. On the other hand, Kotak Institutional Equities projected a loss of Rs 1,202.40 crore in Q1FY20 against a loss of Rs 4,749.60 crore in the preceding quarter ended March 2019. “We expect losses to be lower on the back of lower provisions.
The declines in gross and net non-performing loans will continue but there is no major account for either upgradation or slippage this quarter,” Kotak said.