Why PNB shares hit 10% lower circuit today?

/2 min read

ADVERTISEMENT

PNB shares hit a 52-week low after its profit dropped 66% YoY to ₹201 crore due to higher provisions for bad loans and contingencies.
Why PNB shares hit 10% lower circuit today?
PNB Q4 profit drops 66% YoY to ₹201 crore Credits: Getty images 

Shares of state-owned Punjab National Bank (PNB) were reeling under selling pressure on Thursday, in line with the broader market, with stock price hitting a 52-week low on domestic bourses. PNB shares were locked in a lower circuit of 10% after its fourth-quarter earnings failed to meet Street estimates. In comparision, the BSE Sensex was trading 990 points, or 1.83%, lower at 53,097 levels.

Reacting to Q4 results, PNB share price opened with a loss of 4.23% at ₹31.70 as compared to the previous day's closing price of ₹33.1 on the BSE. The stock slid further and was locked at the 10% lower circuit at ₹29.45 on the BSE.

PNB shares have declined consistently in the past seven sessions and have plunged 14.84% during this period. The banking stock has delivered a negative return of 19.5% in a month, 29% over a six-month period, and 22% on a year-to-date basis (YTD). The share price has fallen 20% in one year, while it has tumbled 65% and 82% in three years and 5 years, respectively.

For the January-March quarter of FY22, PNB reported a 66% year-on-year (YoY) decline in net profit to ₹201 crore as the lender set aside ₹325 crore on account of fraud. The PSU lender had posted net profit of ₹586 crore in the corresponding quarter last year. For the full financial year, the state-owned bank reported a net profit of ₹3,457 crore compared to ₹2,022 crore a year ago.

Fortune India Latest Edition is Out Now!
India's Top 100 Billionaires

August 2025

As India continues to be the world’s fastest-growing major economy, Fortune India presents its special issue on the nation’s Top 100 Billionaires. Curated in partnership with Waterfield Advisors, this year’s list reflects a slight decline in the number of dollar billionaires—from 185 to 182—even as the entry threshold for the Top 100 rose to ₹24,283 crore, up from ₹22,739 crore last year. From stalwarts like Mukesh Ambani, Gautam Adani, and the Mistry family, who continue to lead the list, to major gainers such as Sunil Mittal and Kumar Mangalam Birla, the issue goes beyond the numbers to explore the resilience, ambition, and strategic foresight that define India’s wealth creators. Read their compelling stories in the latest issue of Fortune India. On stands now.

Read Now

The lender's net interest income (NII) rose 5% to ₹7,305 crore from ₹6,957 crore in the same quarter last year. The total income during January-March 2022 stood at ₹21,095 crore as against ₹21,386 crore in the same period previous fiscal.

On the asset quality front, the bank’s gross non-performing assets (GNPA) as a percentage of gross advances dipped to 11.78% from 14.12% a year ago. Net NPA too declined to 4.80% from 5.73% in Q4 FY21.

However, the bank continued with higher provisions for bad loans and contingencies for the March quarter of FY22 at ₹4,851.47 crore, as against ₹3,540.32 crore earlier. Its slippages ballooned 110.8% sequentially to ₹10,506 crore

The bank's board has also recommended a dividend of ₹0.64 per equity share for the financial year 2021-22.

Despite weak earnings, global brokerage Morgan Stanley has maintained an 'equal-weight' rating on PNB with a target price of ₹41 apiece, a potential upside of 23.9% from Wednesday's closing price.

Fortune India is now on WhatsApp! Get the latest updates from the world of business and economy delivered straight to your phone. Subscribe now.