Bandhan Bank (BANDHANBNK)

FairStock Score: 48/100 — MIXED

Score breakdown: P/E: 1/3 · ROCE: 0/2 · Growth: 0/2 · Dividend: 0/1

Key Financials

Strengths

• Book value of ₹152.73 and P/B of 1.14 provide a tangible asset cushion for equity holders.
• Promoter holding of 39.74% keeps management aligned with minority shareholders.
• Piotroski F-Score of 6/9 suggests operational fundamentals have not fully deteriorated.
• Latest quarter revenue of ₹5,431 Cr shows the franchise still has meaningful scale.

Concerns

• Profit growth at -59.42% and ROE at 4.09% indicate severe deterioration in earnings power and capital efficiency.
• Altman Z-Score of 0.50 and negative free cash flow of ₹1,126 Cr point to financial stress.
• P/E of 29.10 and EV/EBITDA of 1,638.48 leave no valuation comfort, especially with a Graham Number of ₹146.55 below the market price.
• Leverage of 6.60 times debt-to-equity amplifies risk when profitability is weak.

AI Analysis

Bandhan Bank fails the Graham test today. At ₹173.80, I am being asked to pay 29.10 times earnings that collapsed by 59.42%, while return on equity is just 4.09% and ROCE is only 7.82%. A bank that earns 4% on equity is not compounding wealth; it is consuming capital. The Graham Number of ₹146.55 implies a margin of safety of -24.17% at the current price, so Mr. Market is not offering a bargain. Book value is ₹152.73, so the P/B of 1.14 looks reasonable only if the franchise can return to historical profitability; current ROE does not justify it. The Altman Z-Score of 0.50 and negative free cash flow of ₹1,126 Cr confirm a strained financial position. High debt/equity of 6.60 may be typical for a bank, but with profit this weak, every rupee of leverage becomes a risk. Latest quarter sales of ₹5,431 Cr are flat year-on-year and net profit of ₹206 Cr is thin. EV/EBITDA of 1,638.48 shows how distorted earnings-based valuation has become. On the positive side, promoter holding of 39.74% aligns interest, Piotroski F-score of 6/9 shows acceptable operational health, and the bank is not at its 52-week high of ₹220.70. But a low P/B is not a catalyst. A value investor buys a business, not a statistic. I need evidence that ROE is recovering and profits are growing before investing. This looks more like a possible turnaround than a stalwart. I would wait for a margin of safety closer to the Graham Number and clear signs of earnings stabilization. Until then, Bandhan Bank is a risky business, not an investment. The FairStock Score of 30/100 calls it risky, and I agree.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer