Reduce Bank of Baroda - TP Rs.761 - Geojit BNP Paribas Financial Services

- 3QFY13 PAT at Rs.1010 crore is 22% lower than market estimates due to higher provisions.

- GNPA was up 25% qoq due to higher slippages.

- Despite higher provisions, the calculated coverage ratio fell to 54.1%. NII was in line with street's estimates with reported NIM down 6 bp qoq.

- Management is not certain about the likely trend in asset quality in the next two to three quarters, mainly due to regulatory uncertainty over classification of NPLs. This uncertainty is expected to give rise to earnings volatility and be reflected in lower valuation multiples.

- The share is expected to remain weak in the near term.

Source : Equity Bulls

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