My only reason for holding is the potential growth in coming years. Near term, I’m looking at about 150-200 by Dec-24. I don’t have a long term price target, as I want to keep holding it forever, with the hope that bank starts giving some dividend in next couple of years.
Even if we take a pessimistic view of just 8% QoQ growth in Net Profit (half of average 17% for last 6 quarters), it easily translates to minimum 1 rupee increase in EPS every year, and thus minimum 20 rupees per year increase in price (assuming long term PE range of 18-20). Obviously, one has to always remember the famous saying that market can remain irrational for an extended period of time. Having said that, I feel that the bank surely seems to be capable of giving numbers much bigger than my assumptions.
Looking forward to hear critical thoughts about this calculation from experts in this forum. Thanks!
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