Canara Bank (CBK IN) – Q2FY27 Result Update – Balance sheet mix and NIM levers to cushion earnings – BUY
Published on 15 Oct 2026
CBK delivered a strong quarter with an all-round beat as core PPoP was 13.3% higher, led by better NII (superior NIM), fees and opex. Loan growth was healthy at 6.5% QoQ; excluding FCNR(B) related loans too, domestic credit growth was strong at ~5% QoQ mainly aided by corporate/agri. NIM may sustain at current level supported by (1) rise in corporate/agri loan yields (2) upcoming festive season that could spur demand for retail credit (3) low LDR at ~80% and (4) EBLR repricing. For FY27/28E we raise NIM by 7/6bps and core PAT by avg. ~6%. We keep multiple at 1.0x but raise TP to INR160 from INR150 as we roll forward to Sep’28 ABV. Retain ‘BUY’
