We hereby present you our investment idea for Equity Investment i.e “Pick of the Week”. A thorough analysis of company, industry and economy goes behind our stock ideas for you. With the “Pick of the Week”, you may earn superior returns in stock market over a time horizon of 6 – 9 months.

INVESTING RATIONALE

• Loan growth at 12% YoY was driven by 21% growth in domestic loan book. This was led by growth in Retail book by 32.6% YoY contributed by home and auto segments. Global NIM expanded 8 bps QoQ to 2.69% fuelled by 30 bps QoQ increase in yield on assets. International NIM increased sharply to 1.99% by 33 bps QoQ

• Asset quality improved with GNPAs down by 77 QoQ to ~11%. In NCLT cases, BOB has a total exposure of Rs 236.5 bn with a strong coverage of 72.9%. The current watch list stands at Rs 85 bn (~2.4% of advances), flat on QoQ basis. It has Rs 46.8 bn exposure to IL&FS (Rs 11.7 bn at holding company level and balance at SPV level) and has provided 20% on the sub-standard part of exposure

• Overall performance in Q3FY19 showed significant improvement with domestic growth momentum building up, driven by retail portfolio and asset quality improvement. Management expects the trend to continue with focus on quality growth and further improving the rating profile.

• We have a BUY with a target of Rs. 144