Market capitalisation of PSU banks rises by up to 91% in Q3
Nine public sector banks reported an increase in market capitalisation in the range of 25-91 per cent in the September quarter, according to S&P Global Market Intelligence.
Midsize state-owned banks saw a surge in market capitalisation in the third quarter, catching up with the rally in the stocks of bigger rivals due to improving metrics and a solid economic growth outlook, S&P said.
Indian Overseas Bank saw its market capitalisation nearly double during the July-to-September quarter, according to S&P Global Market Intelligence data. A 91.60 per cent gain propelled the lender to eighth place in the top 20 Indian banks by market capitalisation as of September 30, up from 14th three months ago, it said.
Five other public sector banks rose in the market cap rankings over the previous quarter. Central Bank of India’s market cap grew 76.59 per cent over the previous quarter, while Union Bank of India gained 59.56 per cent, Indian Bank gained 44.78 per cent and UCO Bank 58.94 per cent, each climbing up two notches in the ranking, the data showed. Bank of India Ltd.’s market cap grew 48.64 per cent, pushing it up one spot, S&P said.
“Buoyancy amongst public sector banks could be attributed to the massive clean-up of their balance sheet at the backdrop of IBC [Insolvency and Bankruptcy Code] in India,” said Sandeep Upadhyay, Managing Director and CEO of Centrum Infrastructure Advisory. The “banking ecosystem has been looking forward to this much-needed one-time cleanup for a very long time,” Upadhyay said in comments emailed to Market Intelligence.
