Reduce Bank of Baroda - Target Price Rs.770 - Kotak

Higher slippages, write-off and restructuring. 2QFY13 was a weak quarter led by higher slippages (2%), rise in restructured loans (40 bps qoq to 7% of loans), decline in coverage ratio (330 bps qoq) and earnings led by treasury (gains and write-back of depreciation was 15% of PBT).

We maintain our cautious outlook (corporate NPLs are currently at 1.6% levels) and would wait till we see slower additions to NPLs to turn positive. We maintain REDUCE and roll forward our TP to Rs.770 (from Rs.710 earlier).

Source : Equity Bulls

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