Outlook & Valuation: At the current market price, the bank’s core banking
business (after adjusting the value of subsidiaries) is trading at 1.6x FY2021E ABV.
We believe strength of liability franchise (CASA – 50%), shift in loan mix towards
retail assets & better rated companies, strong capitalization (tier I of 14.73%),
steady improvement in stressed loan and going forward quick resolution under
IBC would be the key triggers for expansion. We recommend a Buy on the stock
with a Target Price of `490.

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