Contents
1) An in-depth look at PSU banks................................................................. 3
Key macro trends ................................................................................................. 3
Corporate capex on a comeback trail............................................................ 3
Expect net interest margins (NIMs) to expand ........................................... 5
Credit cost outlook .................................................................................... 5
DuPont Decomposition of ROE for PSU banks........................................ 6
Structural variation in the ROE of our PSU bank universe ................................ 9
Valuation and pecking order............................................................. 12
2) Company updates....................................................................................... 13
Bank of Baroda ................................................................................................ 14
Punjab National Bank.......................................................................................... 17
Union Bank of India.......................................................................................... 20
State Bank of India........................................................................................... 23
Bank of India ...................................................................................................... 25