Check Before You Invest : Punjab National Bank

Q: Which industry/sub-sector does Punjab National Bank belong to?

Punjab National Bank belongs to the BFSI sector, operating specifically within the Bank - Public segment.

Q: Is Punjab National Bank a good quality company?

Punjab National Bank is a weak quality company, based on a inconsistent multi-year financial track record. This assessment is based on the bank’s performance on Total Income growth, Pre-Provision Operating Profit, RoA, RoE, CAR, and Asset Quality, along with how these metrics compare with its long-term averages.

Q: Is Punjab National Bank undervalued or overvalued?

Punjab National Bank appears Somewhat overvalued, as its key valuation ratios are higher than their past averages. Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more. Valuation Ratios. Price to Earnings, Current: 6.36, Historic Median: 12.27. Price to Book, Current: 0.84, Historic Median: 0.94. Price to Sales, Current: 0.9, Historic Median: 0.98. EV to EBITDA, Current: 5.36, Historic Median: 4.83

Q: Is Punjab National Bank a good buy now?

Punjab National Bank is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Q: Total Income growth of Punjab National Bank?

Punjab National Bank Total Income growth is 14.76% for FY-2025, which is below its 5-year CAGR of 16.91%, indicating slower growth.

Q: Return on Assets of Punjab National Bank?

Punjab National Bank Return on Asset is 1%, which is above its 5-year historical median of 0.3%, indicating improved earnings on assets. Efficiency & Key Metrics. NIM (%), Current: 2.46, Historic Median: 2.48. PPOP (%), Current: 2.86, Historic Median: 10.07. RoA (%), Current: 1, Historic Median: 0.3

Q: Return on Equity (ROE) of Punjab National Bank?

Punjab National Bank Return on Equity is 15.4% for FY-2025, which is above its 5-year historical median of 4.2%, indicating the business is making better use of its shareholders capital.

Q: Pre-provisioning operating profit margin of Punjab National Bank?

Punjab National Bank Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is 2.86% for FY-2025, which is below its 5-year median(10.07%), indicating decreasing margins.

Q: Net Interest Margin of Punjab National Bank?

Punjab National Bank Net Interest Margin, which is the difference between the rate of interest earned on assets and the rate of interest paid on liabilities, is 2.46% for FY-2025, which is in line with its 5-year median( 2.48%), indicating stable margins.

Q: Does its ROIC exceed its WACC?

Punjab National Bank return on invested capital (ROIC) is 34.95% for FY-2025, is higher than its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

Check Before You Invest : Punjab National Bank

BSE: 532461 NSE: PNB ISIN: INE160A01022

| Sector: BFSI | Industry: Bank - Public

Snapshot

Q.1 Which industry/sub-sector does Punjab National Bank belong to?

Punjab National Bank belongs to the BFSI sector, operating specifically within the Bank - Public segment.

Q.2 Is Punjab National Bank a good quality company?

Punjab National Bank is a weak quality company, based on a inconsistent multi-year financial track record.

This assessment is based on the bank’s performance on Total Income growth, Pre-Provision Operating Profit, RoA, RoE, CAR, and Asset Quality, along with how these metrics compare with its long-term averages.

Q.3 Is Punjab National Bank undervalued or overvalued?

Punjab National Bank appears Somewhat overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios	Current	5-year Historic Median
Price to Earnings	6.36	12.27
Price to Book	0.84	0.94
Price to Sales	0.9	0.98
EV to EBITDA	5.36	4.83

Q.4 Is Punjab National Bank a good buy now?

Punjab National Bank is not a good buy now, based on weak price trend analysis suggesting prices may fall. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

How has it performed on generating Profits?
By checking its Total Income growth, NIM, PPOP, RoA and RoE compared to its last 5-year median.
How efficiently has it grown and managed operations?
By checking its Total Asset growth and Cost-to-Income ratio.
How strong is its Capital position and Asset Quality?
By checking its Capital Adequacy Ratio (CAR), GNPA and NNPA.

A: What are the trends in income and profitability?

Q.1 Total Income growth of Punjab National Bank?

Punjab National Bank Total Income growth is 14.76% for FY-2025, which is below its 5-year CAGR of 16.91%, indicating slower growth.

Q.2 Return on Assets of Punjab National Bank?

Punjab National Bank Return on Asset is 1%, which is above its 5-year historical median of 0.3%, indicating improved earnings on assets.

	Current Level	5-year Historic Median
NIM (%)	2.46	2.48
PPOP (%)	2.86	10.07
RoA (%)	1	0.3

Q.3 Return on Equity (ROE) of Punjab National Bank?

Punjab National Bank Return on Equity is 15.4% for FY-2025, which is above its 5-year historical median of 4.2%, indicating the business is making better use of its shareholders capital.

Q.4 Pre-provisioning operating profit margin of Punjab National Bank?

Punjab National Bank Pre-provisioning operating profit margin, which is the bank’s core operating profit before provisioning for bad loans, is 2.86% for FY-2025, which is below its 5-year median(10.07%), indicating decreasing margins.

Q.5 Net Interest Margin of Punjab National Bank?

Punjab National Bank Net Interest Margin, which is the difference between the rate of interest earned on assets and the rate of interest paid on liabilities, is 2.46% for FY-2025, which is in line with its 5-year median( 2.48%), indicating stable margins.

Q.6 Does its ROIC exceed its WACC?

Punjab National Bank return on invested capital (ROIC) is 34.95% for FY-2025, is higher than its estimated weighted average cost of capital (WACC) of 11.25%, indicating value creation.

B: Does the bank grow efficiently and manage its operating costs?

Q.7 Total Asset growth of Punjab National Bank?

Punjab National Bank Total Asset growth is 16.2% for FY-2025, which is in line with its 5-year CAGR of 16.88%, indicating stable growth.

Q.8 Cost to Income ratio of Punjab National Bank?

Punjab National Bank Cost to Income ratio which represents the cost incurred for every Rs.100 earned is 54.5% for FY-2025, is higher its historical 5-year median of 51.5%, indicating improved cost management.

C: How strong is the bank’s capital position and asset quality?

Q.9 Capital Adequacy ratio of Punjab National Bank?

Punjab National Bank Capital Adequacy ratio (CAR) is 17.01% for FY-2025, which is above the regulatory requirement of 12%, indicating strong capital position.

Q.10 Asset Quality of Punjab National Bank?

Punjab National Bank Gross Non-Performing Assets, which are loans overdue by more than 90 days, is 3.95% for FY-2025, which is below its 5-year median 8.74%, while Net Non-Performing Assets, which is GNPA minus provisions made for bad loans is 0.40% which is below its 5-year median( 2.72%), indicating improving asset quality.

Ownership & governance

D: Promoter shareholding and pledge status of Punjab National Bank?

Q.1 Promoter shareholding and pledge status of Punjab National Bank?

Promoters hold 70.08% of the Punjab National Bank, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Punjab National Bank performance compare with that of its Peers?

Q.1 AUM Growth of Punjab National Bank vs Industry Peers?

Punjab National Bank AUM CAGR is 16.88%, compared to the 5-year industry median CAGR of 17.68%, indicating stable growth and maintaining its market share.

Q.2 Profit metrics (NIM, PPOP, RoA) of Punjab National Bank vs industry peers

Punjab National Bank profit metrics are below the industry median level of 5.79%, indicating weaker profitability compared to peers.

Profit Metrics

	Current Level	5-year Industry Median
NIM (%)	2.46	2.64
PPOP (%)	2.86	13.94
RoA (%)	1	0.8

Q.3 Operating efficiency of Punjab National Bank vs industry peers?

Punjab National Bank Cost to Income (48.35) is in line with the industry median of (49.7); while the current ROE (4.2) are below than the 5-year average Industry ROE (14.15). This shows that the business is positioned in the middle quartile of the industry.

Operating Efficiency

	Current Level	5-year Industry Median
NIM (%)	2.46	2.64
PPOP (%)	2.86	13.94
RoA (%)	1	0.8
Cost to Income (%)	54.5	49.7
ROE (%)	15.4	14.15

Valuation & price assessment

Q.1 Stock return of Punjab National Bank over the last decade?

Over the last 9 years, the stock has delivered a CAGR of 3.4% based on the current price.

	9Y	5Y	3Y	1Y
Share Price CAGR	3.4%	21.9%	26.6%	2.2%

Q.2 How do the current valuation ratios compare with 5-year historical median and industry numbers?

Valuation Ratios	Current	5-year Historic Median	5-year Industry Median
Price to Earnings	6.36	12.27	10.61
Price to Book	0.84	0.94	1.12
Price to Sales	0.9	0.98	1.15
EV to EBITDA	5.36	4.83	5.06

Q.3 Valuation ratios of Punjab National Bank vs historical and industry averages?

The current Price-to-Book (P/B) ratio of 0.84 is lower than its historical median of 0.94, indicating that the stock is trading below its historical average valuation.

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Check Before You Invest : Punjab National Bank

Snapshot

Performance Analysis

Ownership & governance

Peer comparison (industry-wise, mcap)

Profit Metrics

Operating Efficiency

Valuation & price assessment

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Check trending companies

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