Canara banks shares making it more affordable for retail investors

Canara Bank's Board of Directors on Monday approved the sub-division of its equity shares of Rs 10 into five shares with a face value of Rs 2 each.

The move is aimed at improving liquidity in the bank’s shares and making it more affordable for retail investors along with broadening the retail investors' base.

The stock split of its fully paid-up equity shares will be subject to approval for the Reserve Bank of India (RBI).

The announcement was made after market hours and the stock today ended at Rs 571.90 on the NSE, down 1%.

The state-run bank expects to complete the stock split within 2-3 months from intimation of date of Board meeting on February 7, 2024 to the stock exchanges.

The trading window for the Directors, designated persons of the bank and their relatives and all connected persons will reopen on February 29, the filing said.

The multibagger stock fell for second straight session today amid significant volumes as over 81 lakh shares changed hands on the NSE at the time of market closing. Its returns over the past 1 year are at 107%, which is an outperformance over Nifty Bank (15%) and the the broader Nifty (27%).

The PSU lender posted a 29% increase in its profit at Rs 3,656 crore in the third quarter ended December 2023. The bank had earned a net profit of Rs 2,832 crore in the same quarter a year ago. Total income increased to Rs 32,334 crore during the quarter under review against Rs 26,218 crore in the same period last year, Canara Bank said in a regulatory filing.

The net interest income of the bank rose by 9.5% to Rs 9,417 crore during the quarter.

About asset quality, the bank had said that its gross Non-Performing Assets (NPAs) declined to 4.39% of the gross loans by the end of December 2023 from 5.89% a year ago.

Similarly, net NPAs or bad loans came down to 1.32% from 1.96% at the end of the third quarter of the previous fiscal.