Jhunjhunwala portfolio: Canara Bank share hits 52-week high. Buy or sell?

According to stock market experts, rally in Canara Bank shares can be attributed to three basic reasons — RBI giving positive outlook for PSU banks, pre-budget buzz in affordable housing segment trickling down to Can Fin Homes and hawkish interest rate regime leading to improvement in margins of the bank. They said that ₹315 levels would be a good buying range for Canara Bank shares and one can hold the stock for three month target of ₹370 to ₹380 levels.

Speaking on the reason for rise in Canara Bank shares, Ravi Singhal, CEO at GCL Securities said, “Last week, RBI has given positive outlook for PSU banks. This is the major reason for today’s jump in Canara Bank shares despite low volume on Dalal Street and closure of international market. Apart from this, hawkish interest rate regime is also going to improve margins of Canara Bank and other banks. So, this bull trend in Canara Bank is expected to continue till March 2023.”

On fundamentals that is supporting continuous rally in Canara bank shares, Avinash Gorakshkar, Head of Research at Profitmart Securities said, “Budget 2023 will be the last full budget ahead of next Lok Sabha elections. So, market is expecting some big announcement for affordable housing segment where Canara Bank subsidiary Can Fin Homes is a big player. So, market is positive on both Canara Bank and its subsidiary, which is aiding the banking stock to maintain its bull trend.”

Advising Canara Bank shareholders to hold the stock further, Ravi Singhal of GCL Securities said, “Canara Bank shares may go up to ₹370 to ₹380 apiece levels, delivering double digit percentage return to its shareholders by end of March 2023. So, Canara Bank shareholders are advised to hold the stock and keep on accumulating till the stock is above ₹310 levels maintaining stop loss at ₹297.”

Canara Bank share price target

For fresh investors, Ravi Singhal advised them to maintain ‘buy on dips’ strategy and said, ” ₹315 would be a good buying level for a fresh investors. However, those who have high risk appetite can buy the stock at current levels and keep on accumulating till the stock is above ₹310 levels. However, they also must maintain stop loss at ₹297 per share levels.”

Rakesh Jhunjhunwala shareholding in Canara Bank

According to Canara Bank shareholding pattern for July to September 2022 quarter, Rakesh Jhunjhunwala holds 2,68,47,400 Canara Bank shares, which is 1.48 per cent of total paid up capital of the PSU bank. Shareholding pattern of the PSU bank for October to December 2022 is still awaited.

Canara Bank shares have generate alpha return in last one year by outperforming key benchmark indices in this period. In last one year Canara Bank shares have risen to the tune of 65 per cent.

Nifty 50 index registered 2.72 per cent rise while 30-stock index BSE Sensex surged 2.80 per cent. However, Nifty Bank index outperformed key benchmark indices in 2022 by a huge margin as the banking index surged to the tune of 21 per cent in the year gone by. But, broad market indices remained laggard in terms of delivering returns. Small-cap index ended 2022 lower to the tune of 3 per cent whereas BSE mid-cap index finished 0.30 per cent higher.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.