Dividend Paying Rekha Jhunjhunwala Stock To Buy In June

Canara Bank is a large cap public sector lender that closed with a market cap of Rs 56,401.31 Cr on Friday. After climbing to a 52-week high in January 2023 to Rs 341.60 apiece level, the shares of Canara Bank has fallen 7.45% YTD reaching to the current market price of Rs 310.90. This Rekha Jhunjhunwala portfolio stock dropped more than 1.50 percent last week, but managed to gain 3.42% during the previous month.However, after the Q4 and FY23 results, several leading brokerages recommended investors to buy Canara Bank shares so that they may take advantage of the 120% dividend payment and potential gain in the stock price.

Canara Bank Dividend Payout

The Board of Directors of Canara Bank have recommend a dividend of Rs.12/- per equity share (i.e., 120%) of face value of Rs.10/- each to the shareholders for the year 2022-23, subject to the approval of Shareholders at the ensuing Annual General Meeting of the bank. For the payment of dividend, Canara Bank has fixed Wednesday, 14th June 2023 as the record date.

Canara Bank Q4FY23 Results

For the quarter ended March 2023, Canara Bank recorded a standalone net profit rise of 90.63% to Rs 3175 crore. This compared to a net profit of Rs 1,666.22 crore in the same quarter of the previous fiscal year. The lender said that the standalone profit climbed to Rs 10,603.76 crore in 12MFY23 from Rs 5,678.42 crore for the fiscal year that ended in March 2022 or 12MFY22. Its consolidated net profit for the fiscal year that ended in March 2023 jumped from Rs 5,795.10 crore to Rs 10,807.80 crore. Net interest income (NII) increased from Rs 7,006 crore in Q4FY22 to Rs 8,616 crore for Q4FY23, a growth of 23.01%. Operating profit for the lender grew 17% YoY during the March quarter to Rs 7,252 crore. Net non-performing assets (NNPA) ratio for Canara Bank also decreased to 1.73% as of March 2023 from 2.65% as of March 2022, while gross non-performing assets (GNPA) ratio decreased to 5.35% in the March 2023 quarter from 5.89% at the end of March 2022.

Buy Canara Bank Shares?

"Canara Bank (CBK) reported a mixed performance as miss on operating performance was offset by higher 'other income' which drove earnings. Margins stood broadly flat, while asset quality witnessed a steady improvement. Loan growth was led by Corporate, Retail, and Agri segments and the outlook remains encouraging. Slippages moderated sequentially, enabling further improvement in asset quality ratios. The controlled SMA book, along with declining restructuring book, provides additional assurance regarding asset quality. We revise our estimates slightly to factor in lower provisions and remain watchful of the provisioning requirement under the IND-AS. We expect CBK to deliver FY25E RoA/RoE of 1.1%/17.8%. We reiterate our BUY rating with an unchanged TP of INR400 (premised on 0.9x Sep'24E ABV)," said the research analysts of Motilal Oswal.

Rekha Jhunjhunwala Stake In Canara Bank

According to the shareholding pattern of Canara Bank for January to March 2023 quarter, Rekha Jhunjhunwala held fully paid up equity shares of 3,75,97,600 or 2.07% stake in the public sector bank.