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Informist, Saturday, Apr. 18, 2026

By Shubham Rana

NEW DELHI - Punjab National Bank Ltd. is expected to report a three-quarter low increase in its net profit for the March quarter, weighed down by slow growth in net interest income and higher provisions, according to brokerages tracking the lender. A lower tax outgo after the bank shifted to the new tax regime is seen supporting the bottom line.

The country's second-largest public sector bank by deposits is expected to post a net profit of INR 49.67 billion for the March quarter, according to the average of estimates from seven brokerages. This will be up 9% on year but down 3% from the December quarter, when the bank reported a profit of INR 51 billion.

The lowest estimate for net profit is INR 46.50 billion by Nuvama Wealth Management Ltd. and the highest, by Emkay Global Financial Services Ltd., is INR 54.97 billion. Punjab National Bank is yet to announce when it will detail its financial results for the quarter and year ended March.

"We expect the bank to report modest earnings growth yoy (year-on-year) led by lower tax rate, while operating profit is expected to grow modestly yoy," Kotak Securities said in a pre-earnings report. According to brokerage Elara Securities, "softer recovery from written-off accounts, and the treasury outcomes might be soft, dragging overall profitability."

The public sector bank's net interest income - the difference between interest earned and expended - is seen at INR 108.69 billion for the quarter ended March, according to the average of estimates. The net interest income is seen only 1% higher on year and up 3% on quarter.

Punjab National Bank's domestic advances were up 12% on year at INR 11.96 trillion as of Mar. 31, according to provisional data released by the bank on Apr. 2. The bank's domestic deposits rose over 9% to INR 16.49 trillion as of March-end.

Despite weak growth in net interest income, the bank's bottom line is likely to be supported by a lower tax outgo, brokerages said. In the June quarter, the bank had migrated to the new tax regime with a lower rate of 22%. The shift to the lower tax regime led to a one-time charge of INR 33.24 billion for the bank in the June quarter. The bank's management expected to save around INR 7 billion in each of the remaining quarters of 2025-26 (Apr-Mar).

MARGINS, ASSET QUALITY

Brokerages have a mixed view on the Delhi-based bank's margins. Elara Securities expects the bank's net interest margin to rise 4-6 basis points from 2.52% in the December quarter, but Kotak Securities sees it falling marginally on quarter.

Motilal Oswal Financial Services Ltd. and SMIFS Ltd. said the margin is seen broadly stable. "NIMs are likely to remain broadly stable in Q4 (Jan-Mar), as the full impact of the December repo rate cut is largely offset by benefits from ongoing deposit repricing," brokerage SMIFS said in a pre-earnings report.

Slippages are expected to remain low while bad loan recoveries are seen staying healthy "led by higher focus during the last quarter of the year," Kotak Securities said. Credit costs are expected to stay benign on "recovery from one write-off", brokerage Motilal Oswal said.

Of the eight brokerage reports on the bank available with Informist, six have a ‘buy' call on the stock with an average target price of INR 140. One brokerage has a ‘hold' rating and another has a ‘sell' call.

The bank's share price has declined nearly 11% since it released the December quarter financial results on Jan. 19. Shares of the bank Friday ended INR 114.48 on the National Stock Exchange, up 0.8% from the previous close.

Following are the March quarter earnings estimates, in INR billion, from seven brokerages for Punjab National Bank, in descending order of the estimate of net profit:

End

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Avishek Dutta

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