Brokerage firm Anand Rathi maintains a buy rating on Bank of Baroda with a target price of Rs 344. While the bank reported strong Q2 FY27 results, including a 35.8% rise in profit, investors may note that results were boosted by a one-time gain from an NSE stake sale.
Anand Rathi has maintained a buy rating on Bank of Baroda, setting a target price of Rs 344 per share following the lender's second-quarter results for the 2027 fiscal year. The bank reported a standalone net profit of Rs 6,532 crore, marking a 35.8% increase compared to the same period last year. This strong profit growth was largely driven by a one-time gain from selling a partial stake in the National Stock Exchange.
While the headline numbers were strong, the bank's core business also showed positive signs. Loan growth rose by 18.3% year-on-year, led by demand in the retail, agriculture, and small business segments. Reflecting this growth, management has revised its full-year loan growth guidance to a range of 13% to 15%. The bank also achieved a return on assets of 1.26%, a key metric that shows how efficiently it uses its resources to generate profit.
However, there are areas that require investor attention. The bank reported a net interest margin—the difference between the interest it earns on loans and the interest it pays on deposits—at 2.74%. This figure suggests that profit margins may face pressure as competition for deposits intensifies across the banking sector. The sustainability of loan growth without relying on one-time events will be a key factor for the bank's long-term performance.
Moving forward, investors will likely track whether the bank can maintain its deposit growth in a competitive environment while managing margin pressure. Monitoring the bank's ability to balance its loan expansion with the need for stable, low-cost deposits will be essential to understanding its future profitability.