Bank of Baroda Share Price

Bank of Baroda Ltd. Fundamental Analysis

In this guide, we will look at the business model and industry fundamentals of Bank of Baroda Limited with a view to making a determination of whether it could be a good investment choice for you.

Bank of Baroda Limited

Bank of Baroda (BoB) is an Indian government-owned public sector bank, headquartered in Vadodara, Gujarat. It is the second-largest public sector bank in India, following the State Bank of India. Founded by the Maharaja of Baroda, Sayajirao Gaekwad III, on July 20, 1908, in the princely state of Baroda, in Gujarat, it has grown to have a significant international presence.

The bank offers various services such as personal banking services, net banking, corporate banking, and NRI banking among others. Its product portfolio includes retail banking, corporate banking, investment banking, mortgage loans, private banking, wealth management, asset management, investment management, mutual funds, exchange-traded funds, credit cards, and insurance.

The government of India still has the majority stakeholder with 63.97% holdings in the bank that employs about 79806 people. Bank of Baroda’s financial spirit and corporate principles have placed it as one key player among banks in India and globally.

Is the Banking Sector a Goldmine Investment?

The banking sector is a very important part of India’s economy and plays an essential role in financial intermediation, credit allocation, and economic development. The sector is composed of different types of banks such as public sector banks, private sector banks, foreign banks, cooperative credit societies, and regional rural banks.

The Indian banking industry has been growing quickly because of factors such as digitalization, financial inclusion, and consolidation. Actually it is growing at the fastest rate in the world. The projected revenue for the Investment Banking market in India by the end of 2024 is estimated to reach US$15.14bn.

Among the various banking stocks, Bank of Baroda Limited stands out as a good choice for investment.

Who are Bank of Baroda competitors in the Banking Sector?

Bank of Baroda operates in a banking sector that is highly competitive. Some of its main competitors are:

• ICICI Bank
• Canara Bank
• Punjab National Bank
• HDFC Bank
• Axis Bank
• State Bank of India

History of Bank of Baroda Limited

Here’s the overview of the history of Bank of Baroda Limited:

• Incorporation: Bank of Baroda was founded by Maharaja Sayajirao Gaekwad III on July 20, 1908. It was nationalized on July 19, 1969, along with 13 other major commercial banks in India.
• Product Range: The bank offers a wide range of products including retail banking, corporate banking, investment banking, mortgage loans, private banking, wealth management, and more. They also provide digital products like mobile banking, internet banking, and various card services.
• Infrastructure: Bank of Baroda has a robust infrastructure with over 9,693 branches and 10,033+ ATMs as of March 2023. It also has a significant international presence with a network of branches/offices spanning 20 countries.
• Certifications: The bank is actively seeking ISO 22301:2019 certification, which is a standard for business continuity management systems.
• Awards and Recognition: Bank of Baroda has received numerous awards, including the National Award for Outstanding Performance in the SHG Bank Linkage Programme for 2022-23 and recognition for excellence in HR management with the Golden Peacock HR Excellence Award.

Company Profile of Bank of Baroda Limited

Pros:

• Profit Growth: The bank has shown a commendable profit growth of 76.8% CAGR over the last five years.
• Dividend Payout: It has maintained a healthy dividend payout, averaging 19.6%, which is attractive to investors.
• Market Presence: As the second-largest PSU bank, it has a strong market presence and a wide network of branches.

Cons:

• Interest Coverage Ratio: The bank has a low-interest coverage ratio, which could be a concern for debt servicing capabilities.
• Risk Score: Bank of Baroda has a Risk Score of 5.00, where 0 corresponds to a very high risk and 10 corresponds to a very low risk. This score is higher than its peer group’s, indicating that Bank of Baroda is less risky than its peers.

The Financials

Bank of Baroda’s financial summary highlights its performance and stability. Here’s a brief overview based on the latest available data:

Shareholding pattern of Bank of Baroda Ltd.

The shareholding pattern of Bank of Baroda Limited as of the latest update is as follows:

• Promoters: Hold 64.0%
• Foreign Institutional Investors (FII): 28.4%
• Domestic Institutional Investors (DII): 38.3%
• Public: 33.3%

Peer Multiple Comparison

The peer multiple comparison of Bank of Baroda Limited involves evaluating its financial metrics against those of its competitors. Here’s a summary of how Bank of Baroda stands in comparison to other banks in the sector: