Wealth destroyer banking stocks lead rally on Dalal Street
By S Jha
New Delhi, December 13: Several banking stocks had been tormentors of investors, wiping out their investments in a short span of time after an avalanche of non-performing assets hit them hard. Such banking stocks in a course of a few years lost over 90 per cent of their value and also the market capitalisation, becoming penny stocks. But they seem to have rediscovered themselves and are now riding a phenomenal run on the Dalal Streets.
Yes Bank was one such banking stock which had become a penny stock after its promoter and founder Rana Kapoor, who had bet aggressively on the green energy, was caught in the financial irregularities. The share price took the beating and had gone to the sub-10 level from Rs 400 peak during its heydays. Now that the bank has been rescued with the intervention of the government and the Reserve bank of India with the State Bank of India bailing it out, Yes Bank is buzzing on the bourses. It has gained over 30 per cent in a span of a few days, with the retail investors coming to the scrip in hoards.
Punjab and National Bank (PNB) was another such horrendous stock, which was battered by a series of financial fraudsters who ran away from the country, leaving the account book of the banking behemoth in a terrible shape. It has now reportedly cleaned up its account book and is said to have returned in the pink of health. The investors have begun rewarding the turnaround in the banking stock. The share price has doubled in a flat six months, and it is among the bullish banking stock.
Indian Bank was another banking stock which had destroyed the investors’ wealth. It has also gained about 95 per cent in the last six months. Bank of Baroda presents the similar story, with the stock price gaining 92 per cent in the last six months. Jammu and Kashmir Bank, which had also been mired in a series of financial frauds, has been on a stellar run, gaining 126 per cent in the last six months.
Canara Bank, one of the largest public sector bank, has also gained over 60 per cent in the last six months. The runaway share prices of the PSU banking stocks are in contrast to their private peers. ICICI bank has in the last six months gained about 35 per cent, while being one of the best performer among the private banking stocks.
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