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<ul><li>India's inclusion into JP Morgan's Government Bond Index is good news for PSU <keyword id="74326" type="General" weightage="20" keywordseo="bank-stocks" source="Orion">bank stocks</keyword>.</li><li>PSU bank stocks have been rallying for the last three sessions in spite of broader markets slipping.</li><li>There is buying interest because their valuations are not so demanding, experts say. </li></ul>Indian public sector bank stocks have been rallying for the last three sessions – even as the broader markets as well as Nifty Bank have been experiencing pain on account of bearish Fed commentary. The Nifty PSU Bank index has inched up by 15% in the last month, and is close to its 52-week high. Three of its 12 constituents – Union Bank, Indian Bank and Canara Bank – hit their 52-week high in the last session. The Indian Overseas Bank also saw a huge run up as well as profit booking last week. Apart from the many existing triggers, these stocks were also buoyed by India's inclusion into JP Morgan's Government Bond Index – which led to a decline in bond yields. While India’s banking sector can gain as a whole from it, PSU banks in particular have a lot more room to stretch their legs, say experts. “The inclusion into the bond market is good for the bond market and PSU banks,” Gaurav Dua, senior VP and head of capital market strategy at Sharekhan by BNP Paribas, told Business Insider India. PSU banks have a larger part of bond holdings and it will help them more even though its a positive move for all banks, say experts. “They will soon see growth in treasury gains from the recent move,” says Shreyansh Shah, research analyst at StoxBox, told Business Insider India. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">30 day change </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Price to Book ratio </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bank of Baroda </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">13.4 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1.1 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Indian Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">6.4 </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1.2 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Union Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">13.8% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Punjab National Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">26% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.9 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">SBI </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">4.9% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1.6 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bank of India </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">26.7% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.8 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Canara Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">17.6% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Indian Overseas Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">40.3% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">3.3 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Punjab Sind Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">31.7% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bank of Maharashtra </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">19.8% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.3 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">UCO Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">33.2% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.2 </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Central Bank of India </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">42.2% </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1.7 </td></tr></tbody></table>Source: NSE, Trendlyne Reasons for the positive momentum Even before the inclusion in the international index came in, PSU stocks were outliers after the market crashed all of last week. Investors bought into these stocks which have been seeing many positive triggers like the Reserve Bank of India (RBI) move to gradually unwind its mandate to scheduled banks to maintain an I-CRR or incremental cash reserve ratio of 10%. Over the last few months, PSU banks have recorded good earnings reports with their networth improving and gross non-performing assets (NPAs) improving. “The credit growth is on par with private banks and they are also getting into areas like business development and cross-selling like their private sector peers. They are also prompt in terms of provisioning. The current rally is justified,” says Shah. Not booking profits, yet In the 11-session rally that was seen in late August and early September, a lot of companies and sectors went into the ‘overvalued zone’ and had come under heavy profit booking during the subsequent crash. But experts see value in PSU banking stocks. “There is buying interest because some PSU banks have better valuations, which are not so demanding. If you hold on to them, in 18-24 months, investors can make handsome money,” says Dua. Most PSU banks saw double-digit credit growth in sectors like MSMEs, retail and housing and there is belief that corporate loans will also grow, due to government spending on infrastructure. In the event of an interest rate cut, there could be another push for good growth in credit business, that will aid these banks and their investors.

PSU bank stocks on a high with room to play

<ul><li>Shares of <keyword id="107781" type="General" weightage="20" keywordseo="indian-overseas-bank" source="Orion">Indian Overseas Bank</keyword> scaled new heights, as the Reserve Bank of India (<keyword id="30067" type="General" weightage="20" keywordseo="rbi" source="Orion">RBI</keyword>) lifted it out of its prompt corrective action (<keyword id="6383105" type="General" weightage="20" keywordseo="pca" source="Orion">PCA</keyword>) framework.</li><li>IOB’s stock rose as much as 13% on Thursday morning trade to ₹23.15 apiece, as of 10:30 am. On a year-to-date basis, the stock surged up by about 114%.</li><li>Earlier this month, the RBI lifted UCO Bank out of the PCA regime, while IDBI Bank was taken out in March. Now, the Central Bank of India is the only lender to still not have exited the PCA framework.</li></ul>Shares of Indian Overseas Bank scaled new heights, as the Reserve Bank of India (RBI) lifted the bank out of prompt corrective action (PCA) framework after nearly six years. As Indian Overseas Bank stepped out of the PCA shadow, its stock rose as much as 13% on Thursday morning trade to ₹23.15 apiece, as of 10:30 am. On a year-to-date basis, the stock surged up by about 114%. Simply put, the PCA framework of the central bank places lending and business limits on commercial banks if they breach its rules on regulatory capital, <keyword id="142154" type="General" weightage="20" keywordseo="bad-loans" source="Orion">bad loans</keyword> and leverage ratio. In 2017-18, the RBI had placed 11 public sector lenders under PCA, which at the time comprised nearly a fifth of the system-wide credit and deposits. The nature and degree of curbs under PCA are threshold-based and depend on the financial profile of each bank. Earlier this month, the RBI lifted UCO Bank out of the PCA regime, while IDBI Bank was taken out in March. Now, the Central Bank of India is the only bank to still not have exited the PCA framework. <div type="image" title="indian overseas bank" msid="86635530" hostid="261"></div> After being placed under the PCA regime, IOB’s market share has been on a constant decline. Between fiscal 2016 and 2021, its market share in deposits nearly halved to 1.6% from 2.5%, while in net loans it fell to 1.2% from 2.3%, as per a September 22 note by ratings firm India Ratings. “However, Ind-Ra [India Ratings] believes that, after spending six years under the PCA framework, if and when the bank exits the same, it would take some time to fast track lending to the extent possible (through the various stages of a loan cycle, including augmenting the strength of the existing teams),” it said. Indian Overseas Bank: Financial Profile <table style="border-width: initial; border-style: none;"></colgroup><tbody><tr><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#bfbfbf;padding:1pt 1pt 1pt 1pt;overflow:hidden;overflow-wrap:break-word;"> </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#bfbfbf;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY21 </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#bfbfbf;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">FY20 </td></tr><tr><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:2pt 1pt 5pt 1pt;overflow:hidden;overflow-wrap:break-word;">Total assets (₹ billion) </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2,740 </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2,607 </td></tr><tr><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 1pt 5pt 1pt;overflow:hidden;overflow-wrap:break-word;">Net Profit (₹ billion) </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">8.31 </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-85.3 </td></tr><tr><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 1pt 5pt 1pt;overflow:hidden;overflow-wrap:break-word;">Return on average assets (%) </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">0.3 </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">-3.3 </td></tr><tr><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 1pt 5pt 1pt;overflow:hidden;overflow-wrap:break-word;">Capital adequacy ratio (%) </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">15.32 </td><td style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">10.72 </td></tr><tr><td colspan="3" style="border-left:solid #000000 0.99609pt;border-right:solid #000000 0.99609pt;border-bottom:solid #000000 0.99609pt;border-top:solid #000000 0.99609pt;vertical-align:top;background-color:#ffffff;padding:5pt 1pt 5pt 1pt;overflow:hidden;overflow-wrap:break-word;">Source: Ind-Ra </td></tr></tbody></table> SEE ALSO: <a href="https://www.businessinsider.in/investment/news/cardano-is-no-longer-the-worlds-third-largest-cryptocurrency/articleshow/86633849.cms">Cardano is no longer the world’s third largest cryptocurrency</a> <a href="https://www.businessinsider.in/business/ecommerce/news/the-amazon-bribery-case-in-india-is-getting-murkier-and-the-lack-of-transparency-is-not-helping/articleshow/86553927.cms">The murky case of bribery, allegedly on behalf of Amazon, has many unanswered questions</a> <a href="https://www.businessinsider.in/stock-market/news/zee-entertainment-blue-dart-irctc-and-other-top-stocks-to-watch-out-for-on-september-30/slidelist/86633138.cms">Zee Entertainment, Blue Dart, IRCTC and other top stocks to watch out for on September 30</a>

Indian Overseas Bank lost six years and half its business to clean up its bad loans but the market is cheering

New Delhi, Dec 27 () Indian Overseas Bank (IOB) on Friday said it will get a fresh capital infusion of Rs 4,360 crore from the government in the current financial year for meeting regulatory requirement.
In August, the finance ministry had announced a capital infusion of Rs 3,800 crore in the state-owned lender. This has now been increased by Rs 560 crore.
"The Bank has received vide letter dated December 25, 2019 for release of Rs 4,360 crore towards contribution of the central government in the preferential allotment of equity shares (Special Securities/Bonds) of the Bank during 2019-20 as Government's investment," IOB said in a BSE filing.
Besides, the government has approved infusion of Rs 2,142 crore in UCO Bank in line with what was announced in August this year.
Both the lenders are under the Prompt Corrective Action (PCA) framework of the Reserve Bank.
IOB has reported widening of net loss to Rs 2,253.64 crore for the quarter ended September 30, 2019.
 The bank had registered a loss of Rs 487.26 crore in the year-ago period. In the June quarter of the current financial year, it had posted a loss of Rs 342 crore.
IOB's gross non-performing assets stood at 20 per cent (Rs 28,673.95 crore) of gross advances during the September quarter, compared with 24.73 per cent (Rs 37,109.96 crore) in year-ago same period.
Net NPAs during the quarter stood at 9.84 per cent as against 14.34 per cent in the year-ago period.
The Net NPA level is higher than the RBI's comfortable level of 6 per cent.
The PCA framework kicks in when banks breach any of the three key regulatory trigger points namely capital to risk weighted assets ratio, net non-performing assets (NPA) and return on assets (RoA). DP ANU

Govt ups capital infusion in IOB to Rs 4,360 cr

<ul><li>At 7:50 am the SGX Nifty was trading 0.47% higher pointing towards a cautious start for Nifty50. </li><li>Here’s a list of stocks to watch for in trade today. </li><li><a href="https://www.businessinsider.in/">Check out the latest news and updates on Business Insider</a>. </li></ul>Indian stock market is likely to open on a muted note amidst mixed cues from global peers. At 7:50 am the SGX Nifty was trading 0.47% higher pointing towards a cautious start for Nifty50. The Hang Seng Index of the Hong Kong stock market was also trading 0.41% higher on September 8. Here’s a list of stocks to watch for in trade on September 8: HDFC Bank, ICICI Bank, SBI and other banking stocks HDFC Bank, ICICI Bank, SBI and other banking stocks will be in focus today after the RBI-appointed KV Kamath committee has submitted a resolution framework for stressed loan accounts. It has outlined parameters for 26 sectors. These <a href="https://economictimes.indiatimes.com/news/economy/policy/rbi-constituted-kv-kamath-committee-names-26-sectors-for-restructuring/articleshow/77981829.cms">26 sectors will require</a> loan restrictions based on the analysis of their financial parameters after COVID impacted businesses. Future Consumer Kishore Biyani led Future Group firm Future Consumer said it has defaulted on payment of principal redemption and interest on non-convertible debentures. The current default amount includes principal of ₹20 crore and interest of ₹2.03 crore, payable annually. The shares of Future Consumer ended 5% lower yesterday. Future Enterprises Kishore Biyani led Future Enterprises reported a consolidated net loss of ₹394.77 crore for the fourth quarter ended March 31. The company’s revenue from operations was down 50.01% to ₹783.28 crore during the quarter under review. This may also move other Future Group subsidiaries such as Future Retail, Future Lifestyle Fashions, Future Consumer, among others. The shares of Future Enterprises ended 5% lower yesterday. Indian Overseas Bank Indian Overseas Bank (IOB) has cut its marginal cost of funds based lending rate (MCLR) by 10 basis points (bps) across all tenors effective September 10. MCLR is actually the minimum interest rate below which financial institutions can’t lend. The shares of IOB ended 2% lower on September 7. Bharat Dynamics The central government is looking to sell 15% of its stake in Bharat Dynamics. The government currently owns 87.75% of the company’s stake, and it is looking to offload 2.71 crore shares at a floor price of ₹384.50. The shares of Bharat Dynamics ended 2% lower on September 7. Info Edge Info Edge reported a 24.7% jump in its India standalone net profit to ₹83.2 crore for the first quarter ended June 30. Although the company’s revenue fell 10.5% to ₹280.1 crore in the period under review. The shares of Info Edge ended 2% lower on September 7. Parag Milk and Foods Parag Milk reported a steep fall in its net profit for the first quarter ended June 30. The company’s revenue declined to ₹435.6 crore from ₹629.74 crore in the same quarter last year. The board also approved raising ₹ 230 crore via sale of non-convertible debentures. Non-convertible debentures can’t be converted into shares or equities. The shares of Parag Milk and Foods ended 2% higher yesterday. SEE ALSO: <a href="https://www.businessinsider.in/defense/news/new-skirmish-at-india-china-border-along-pangong-tso-lake/articleshow/77989048.cms" data-type="tilCustomLink">New skirmish at India-China border along Pangong Tso Lake</a> <a href="https://www.businessinsider.in/business/corporates/news/deepak-kochhar-husband-of-former-icici-bank-chief-chanda-kochhar-arrested-in-videocon-loan-case/articleshow/77982638.cms" data-type="tilCustomLink">Deepak Kochhar, husband of former ICICI bank chief Chanda Kochhar, is arrested in connection with Videocon loan case</a>

Top stocks to watch— SBI, HDFC Bank, ICICI Bank, Future Retail, Future Enterprises, Indian Overseas Bank, Bharat Dynamics, Parag Milk, Info Edge and more

<ul><li>Indian banks are rallying on the stock market after the Supreme Court’s judgement on the <keyword id="9876042" type="UNKNOWN" weightage="20" keywordseo="Loan-moratorium-case">loan moratorium case</keyword> on March 23.</li><li>The verdict now removes the stay that was in place keeping banks from declaring accounts as bad loans or non-performing assets.</li><li>Public sector banks saw their shares gain by as much as 10% in a bull run led by <keyword id="107781" type="CITY" weightage="20" keywordseo="Indian-Overseas-Bank">Indian Overseas Bank</keyword> (IOB), Bank of Maharashtra and <keyword id="6355303" type="COMPANY" weightage="20" keywordseo="bank-of-india">Bank of India</keyword> (BOI).</li></ul>Indian banks are rallying on the stock market after the Supreme Court’s judgement on the loan moratorium case today. The verdict finally ends the long pause that the apex court had put in place keeping Indian banks from declaring accounts are non-performing assets (NPAs) or bad loans. The top court also said that the complete interest waiver is not possible while refusing to extend the moratorium beyond the designated six months. According to rating agency ICRA, this would have cost the government ₹7,000 crore to ₹7,500 crore. <div type="Article" hostid="261" msid="81645705" title="India's Supreme Court waives compound interest on ALL loans put under moratorium due to COVID-19 pandemic" mstype="2" mssubtype="0"></div> However, banks are still required to excuse any interest on interest — or compound interest — that these loans may have accrued during the six-month moratorium period from March till the end of August 2020. Public sector banks, in particular, are rallying in reaction to the news led by Indian Overseas Bank (IOB), Bank of Maharashtra and Bank of India (BOI). This is likely because these banks had the most at stake. <table style="border-width: initial; border-style: none; table-layout: fixed; width: 468pt;"></colgroup><tbody><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Public sector bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Percentage change in share price </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Indian Overseas Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">10% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bank of Maharashtra </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">9.97% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bank of India </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">9.94% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Central Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">4.72% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Union Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">3.77% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Indian Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">3.67% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Bank of Baroda </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.97% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Canara Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.63% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">Punjab National Bank </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">2.11% </td></tr><tr><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">State Bank of India </td><td style="border-left:solid #000000 1pt;border-right:solid #000000 1pt;border-bottom:solid #000000 1pt;border-top:solid #000000 1pt;vertical-align:top;padding:5pt 5pt 5pt 5pt;overflow:hidden;overflow-wrap:break-word;">1.36% </td></tr></tbody></table>Source: Nifty PSU Bank According to a report by CARE ratings, the gross NPA ratio of public sector banks stood at 9.01% in December 2020 compared to 3.49% with private banks. Analysts, and <a href="https://www.businessinsider.in/finance/banks/news/bad-loans-in-india-to-get-1-5-times-bigger-this-year/articleshow/77147120.cms">the RBI</a>, have been fearful that the COVID-19 pandemic will set off a fresh cycle of bad loans in India. The apex bank’s most recent financial stability <a href="https://www.rbi.org.in/Scripts/PublicationReportDetails.aspx?UrlPage=&amp;ID=1162">report</a> shows that the GNPA ratio of public sector banks could hit 17.6% under the worst-case scenario by September 2021. IEven i the baseline scenario the ratio can rise to13.5% by September 2021 which is almost double of the ratio of 7% as of December. Nonetheless, the banks have been preparing themselves. They have been storing up provisions in order to address the sudden inflow of bad loans that is likely to occur now. Cumulative provisions made by these banks for the yearm, which includes for NPAs among others, was around ₹ 1.78 lakh crore over the past three quarters. Having the ability to declare accounts as NPA will also allow investors and stakeholders to have a clearer view of the banks’ balance sheets. SEE ALSO: <a href="https://www.businessinsider.in/tech/apps/news/supreme-court-orders-to-pause-all-cases-against-netflix-amazon-prime-and-others-in-high-courts-across-india/articleshow/81647182.cms">Supreme Court orders to pause all cases against Netflix, Amazon Prime and others in High Courts across India</a> <a href="https://www.businessinsider.in/finance/banks/news/indias-supreme-court-waives-compound-interest-on-all-loans-put-under-moratorium-due-to-covid-19-pandemic/articleshow/81645705.cms">India's Supreme Court waives compound interest on ALL loans put under moratorium due to COVID-19 pandemic</a> <a href="https://www.businessinsider.in/personal-finance/news/your-take-home-salaries-could-shrink-sharply-in-april-with-indias-new-definition-of-wages/articleshow/81631662.cms">Your take-home salaries could shrink sharply from April with India’s new definition of wages — but companies are hoping for a delay</a>

India's banking stocks are on fire after top court allows them to call out bad loans

<ul><li>At 7:45 am, the SGX Nifty was down 1% at 8.56 points pointing towards a lower start for Nifty50.</li><li>Here’s a list of <keyword id="73648" type="PERSON" weightage="20" keywordseo="Stocks-to-watch">stocks to watch</keyword> for in trade today. </li><li><a href="https://www.businessinsider.in/">Check out the latest news and updates on Business Insider.</a> </li></ul>Indian stock-market indices are likely to open in green on Friday, on the back of positive cues from the global markets. At 7:45 am, the SGX Nifty was down 1% at 8.56 points pointing towards a lower start for Nifty50. US stocks finished higher on Thursday, buoyed by strong gains in tech shares. Nasdaq ended at a record high. Asian markets too have opened on a positive note. These are the stocks to watch out for during the trading session today: Future Retail and RIL <a href="https://www.business-standard.com/article/companies/future-enterprises-board-likely-to-discuss-merger-plan-on-saturday-120082100066_1.html">According to reports</a>, the board of Future Enterprises is likely to discuss the proposal to merge other listed group entities, such as Future Lifestyle, Future Retail, and Future Supply Chain Solutions, with itself on Saturday. After completing the process, Ambani’s owned Reliance Industries will be investing ₹8,500 crore in the merged entity by way of additional capital, said the report. The shares of RIL ended nearly 2% lower, whereas Future Retail was up 4% yesterday. Divi’s Lab and SBI Life Insurance SBI Life Insurance and Divi’s Lab will enter benchmark index Nifty50 on September 25, the stock-exchange said on Thursday. It will replace Zee Entertainment and Bharti Infratel on the index. The shares of Divi’s Lab ended nearly a percent higher, whereas SBI life Insurance tanked nearly 2% yesterday. Wipro Wipro has set up a blockchain-based gas trading platform for Uniper Global Commodities SE. The platform is built in collaboration with Uniper Global utilises a consortium model for all ssLNG market participants to help transform the trading market space, which will result in significant market efficiencies and cost savings for traders. The shares of Wipro closed nearly 2% lower yesterday. Indian Overseas Bank The Indian Overseas Bank posted a net profit of ₹121 crore for the first quarter ended June 30, mainly due to fall in bad loans. Total income of the bank during April-June 2020-21 rose to ₹5,233.63 crore from ₹5,006.48 crore in the same period of the previous fiscal, mainly due to an increase in treasury income, it said. The shares of IOB closed nearly 5% higher yesterday. Premier Explosives Premier Explosives won an order from Israel Aerospace Industries Limited. The company also added that the order is expected to be delivered within 9 months. The shares of IOB closed over 1% lower yesterday. Future Enterprises Kishore Biyani-led Future Enterprises Ltd (FEL) on Thursday said it has defaulted on interest payment of non-convertible debentures. "The company is unable to service its obligations in respect of the interest on non-convertible debentures (NCDs) due on August 16, 2020, since August 16, 2020 was holiday, interest was due on 17 August 2020," Future Enterprises said in a filing to stock-exchanges. The shares of Future Enterprises closed over 5% higher yesterday. Hindalco Hindalco Industries has signed an MoU with UltraTech Cement to deliver 1.2 million metric tonne of bauxite residue annually to the cement company’s 14 plants located across seven states. Hindalco claims to be the world’s first company to achieve 100% red mud (bauxite residue) utilisation, across three of its refineries. The shares of Hindalco closed nearly a percent higher yesterday. Punjab National Bank, Oil India, Indiabulls Housing Finance, Coffee Day Enterprises, Rossari Biotech These companies are slated to report their first-quarterly earnings today. SEE ALSO: <a href="https://www.businessinsider.in/business/ecommerce/news/indias-e-commerce-is-now-even-better-than-before-smaller-cities-add-to-the-bounty-while-metros-continue-to-lead/articleshow/77655199.cms" data-type="tilCustomLink">India’s e-commerce is now even bigger than pre-COVID – smaller cities add to the bounty while metros continue to lead</a> <a href="https://www.businessinsider.in/finance/news/rbi-governor-wants-keep-indias-monetary-war-chest-dry-for-future-use/articleshow/77656482.cms" data-type="tilCustomLink">RBI Governor wants keep India's monetary war chest dry for future use</a>

Top stocks to watch today— Wipro, Future Retail, RIL, Divi’s Lab, SBI Life Insurance, Hindalco, Rossari Biotech and more

<keyword id="107781" type="CITY" weightage="80" keywordseo="Indian-Overseas-Bank">Indian Overseas Bank</keyword>, a government-owned lender, rose for the 2nd day after it made a preferential issue to the government in exchange of funds to boost its lending.
 IOB, 73.8 percent owned by the government, allotted 48.56 crore <keyword id="30335" type="ORGANIZATION" weightage="20" keywordseo="Shares">shares</keyword> to the government at a price of 41.37 rupees each to raise 2,008.99 crore rupees. The amount will help IOB improve its capital adequacy and augment lending.
 IOB jumped 5.9 percent to 37.55 rupees in late afternoon trade. More than 1 crore shares of IOB were traded versus a 5-day average of 20.88 lakh shares on the <keyword id="53581" type="CITY" weightage="80" keywordseo="NATIONAL-STOCK-EXCHANGE">National Stock Exchange</keyword>. The stock made it to the top volume buzzers list on the NSE.

	IOB's market capitalisation has fallen 40 percent in the past one year to 4,391 crore rupees as investors stayed away from PSU lenders in the wake of rising non-performing assets. IOB is trading at one-third its book value of 113 rupees per share. 
	 
	Image credit: Indiatimes

Shares of Indian Overseas Bank rose for the second day. Know why

New Delhi, Feb 10 () State-owned Indian Overseas Bank (IOB) has reported widening of its net loss to Rs 6,075.49 crore during the third quarter ended December 2019, owing to higher provisioning for bad loan. The bank had registered a net loss of Rs 346.02 crore during the corresponding October-December period of 2018-19. Its total income during the December 2019 quarter also fell to Rs 5,197.94 crore from Rs 5,688.59 crore in the year-ago quarter, IOB said in a regulatory filing. Provisioning for bad loans jumped to Rs 6,663.94 crore, compared with Rs 2,075.28 crore a year ago. The bank's gross non-performing assets (NPAs), however, dropped to 17.12 per cent of the gross loans at the end of December 2019, from 23.76 per cent a year ago. Net NPAs fell to 5.81 per cent from 13.56 per cent. In value terms, the gross NPAs were valued at Rs 23,733.86 crore from Rs 35,786.57 crore. Net NPAs were Rs 7,087.09 crore from Rs 17,987.92 crore. On NPA divergence for 2018-19, the bank said there was a gap of Rs 358 crore in gross bad loans, as the bank had reported it to be Rs 33,398 crore while the Reserve Bank of India assessed it to be at Rs 33,756 crore . Net NPAs divergence was of Rs 358 crore and the divergence for provision came in at Rs 2,208 crore. Thus, overall loss during 2018-19 was adjusted to Rs 5,999.90 crore from the earlier reported Rs 3,737.90 crore. The provision coverage ratio improved to 86.20 per cent, IOB said. Shares of IOB closed at Rs 9.92 apiece on the BSE, up 1.95 per cent. KPM HRS

Indian Overseas Bank Q3 net loss widens to Rs 6,075 cr on higher bad loan provisioning

Shares of <keyword id="107781" type="CITY" weightage="100" keywordseo="Indian-Overseas-Bank">Indian Overseas Bank</keyword>, majority controlled by the <keyword id="6377129" type="ORGANIZATION" weightage="100" keywordseo="Government-Of-India">Government of India</keyword>, fell to their lowest level in at least five years after the PSU lender reported a sharp surge in non-performing assets coupled with an equally precipitous drop in first quarter profit. 

	IOB said its first quarter consolidated Net Profit fell 50 percent to 14.7 crore rupees compared with 27.2 crore rupees in the same quarter a year ago. Total Income during April-June gained 6 percent to 6,672 crore rupees from 6,284 crore rupees in the year ago period. 
 

	The bank's Gross Non Performing Assets surged to 9.4 percent versus 5.8 percent in the same quarter previous year. Similarly, the Net NPAs showed an upward trajectory, rising to 6.31 percent in the first quarter compared with 3.85 percent in the year ago period, the bank said in a statement to the exchanges.
 

	IOB Futures were the top losers in the Futures and Options market with Open Interest rising 9.1 percent and the counter showing a heavy build up of short positions. 
 

	They were down 2.25 rupees, down 5.9 percent, at 35.70 rupees.
 IOB's market capitalisation has fallen 49 percent in the past one year to 4,694 crore rupees as investors dumped PSU <keyword id="87658" type="UNKNOWN" weightage="100" keywordseo="banking-stocks">banking stocks</keyword> on the back of the rising NPA problem and a critical slowdown in the main industrial sectors of Infrastructure, steel, power and construction. 
	 
	(Image credits: frontline)

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