Canara Bank (CBK IN) – Q4FY26 Result Update – LDR at comfortable level to support growth – Upgrade to ‘Accumulate’
Published on 12 May 2026
CBK saw a good quarter as core PPoP was ~13% ahead of PLe driven by higher NII/NIM and lower opex. Reported NIM performance was better to peers since it rose by 9bps QoQ driven by (1) fall in deposit cost and (2) healthy retail growth at 8.6% QoQ. NIM for FY27 is guided to be between 2.5-2.6% (FY26 2.51%). Provisions may remain stable at 0.75% despite ECL impact which could be INR 100bn or 9% of equity, primarily towards stage-2 and non-funded exposure. CBK is better placed than peers in terms of LDR, which is lower at ~78%. We trim multiple from 1.1x to 1.0x on Mar’28 ABV and lower TP to INR 150 from INR 160. Revise rating to ‘ACCUMULATE’ from ‘HOLD’.
