Bandhan Bank share rebounds 7% from day’s low; here’s why

Shares of private sector lender Bandhan Bank rallied more than 4% in early trade on Friday amid spurt in volume trade. The stock witnessed a surge in volume trade as more than 5 crore equity shares of the lender changed hands in a series of block deals. The details of the buyers and sellers were not ascertained immediately, but as per a report HDFC sold 3% stake in the lender through block deals.

As on December 31, 2021, Housing Development Corporation Limited (HDFC) owned 159.36 million or 9.89% stake in Bandhan Bank, as per shareholding pattern data available on the BSE.

The stake sale by HDFC came days after its board approved the merger with HDFC Bank to create a new financial sector behemoth in India. HDFC needed to bring down its stake in Bandhan Bank to under 5% in wake of the proposed merger.

Bandhan Bank shares opened lower today and declined as much as 2.85% to hit a low of ₹306.55, against the previous close price of 315.55 apiece on the BSE. Paring opening losses, the stock rebounded as much as 7.4% from day’s low to touch a high of ₹329.50 during the session so far. On the volume front, 5.26 crore shares worth ₹1,616 crore changed hands over the counter as compared to two-week average volume of 5.62 lakh shares. The market capitalisation of the largecap bank stock surged to ₹52,833 crore.

Meanwhile, shares of HDFC were trading 0.9% lower at ₹2,439.65 apiece on the BSE.

Earlier this week, Bandhan Bank informed the exchanges that it reported robust business growth during the fourth quarter ended March 31, 2022. In an exchange filing on April 5, the private lender said that its loan book crossed the ₹1 lakh crore mark for the first time in Q4 FY22, up 16% year-on-year (y-o-y) and 15% quarter-on-quarter (q-o-q). The bank's total loan stood at ₹1.01 lakh crore at the end of March quarter of 2022.

Deposits grew by 24% YoY to ₹96,331 crore, of which retail deposit stood at 77%. CASA (Current Account Savings Account) deposits rose 18% y-o-y to ₹40,072 crore, however, CASA ratio declined to 41.6% from 45.6% in Q3FY22, the bank said. The bank’s collection efficiency ratio (CER) rose to 96% in Q4FY22 compared with 93% during October-December.