PNB Surges Over 7% as Q1 Earnings Ignite Bullish Frenzy; Analysts Rate Stock 'Add' and 'Buy'
Punjab National Bank (PNB) shares witnessed a significant surge on Tuesday, rising more than 7% in two sessions following the state-owned lender’s commanding first-quarter earnings. The strong performance, driven by robust profitability improvements and enhanced asset quality, has led brokerage houses to issue bullish calls on the PSU bank.The stock closed at Rs 113.38 apiece today, reaching the highest level recorded in nearly three months. This rally comes after PNB reported a substantial 214% year-on-year (YoY) surge in net profit for Q1 FY27, which stood at Rs 5,253 crore.
Key Financial Highlights from PNB's Q1 Results
The Q1 results showed marked operational improvements across the board. Net interest income (NII) climbed by 2% YoY to reach Rs 10,798 crore. The bank’s Return on Equity (RoE) held steady at 17.33% during the quarter under review.Asset quality metrics also showed clear signs of strengthening. Gross non-performing assets (NPAs) decreased to 2.78% by the end of the June quarter, a noticeable drop from 3.78% recorded a year earlier. PNB's deposits grew healthily, with current account savings account deposits rising approximately 8% YoY to Rs 5.69 lakh crore.
Brokerage Views on PN B's Future Growth Potential
Analysts have responded positively to the results, noting that the PSU lender outperformed estimates in its first-quarter disclosures. JM Financial upgraded its rating from 'Reduce' to 'Add', setting a target price of Rs 120 apiece, which implies an upside potential exceeding 7%.The domestic brokerage firm highlighted the strong core operating performance driving the PAT increase. Furthermore, NII grew as Net Interest Margin (NIM) expanded by 6 basis points (bps) quarter-on-quarter (QoQ). This improvement was supported by efficient funding costs and the successful run-down of low-yielding IBPC and corporate exposures.
Investment Outlook: Targets from Financial Experts
Motilal Oswal Financial Services maintained a 'Buy' call on PNB shares, setting a target price of Rs 135, suggesting a potential upside of 21%. This confidence is underpinned by the bank’s improved asset quality trends and management guidance for loan growth of approximately 12-13% in FY27.JM Financial reiterated its belief in further margin expansion throughout FY27. They noted that FCNR mobilisation provides incremental support to funding needs, thereby limiting the downside risk at around 0.8x P/BV for FY28. Consequently, JM Financial raised their FY27E and FY28E EPS estimates by 18% and 15%, respectively.
Stock Performance and Market Position
In terms of broader market trajectory, PNB shares gained over 4% in one month and more than 7% in a single week. However, the stock has seen a decline exceeding 9% over the course of 2026 so far. The PSU lender currently holds a market capitalization nearing Rs 1.3 lakh crore.Despite marginal returns observed over a one-year period, PNB shares have delivered strong long-term gains, rising over 80% in three years and nearly 184% across five years.
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