Bank of Baroda shares may rise 29% after Q4 results but IIFL sounds a word of caution

Shares of Bank of Baroda Ltd. gained on Monday, May 11, after brokerages are largely positive on the lender post its fourth quarter earnings and see an upside potential of up to 29% upside.

While CLSA and JPMorgan have "outperform" and "overweight" ratings each, Kotak Institutional Equities has an "add" rating, BoFA Securities and Citi have "buy" recommendations, while Jefferies has a "hold" rating on the stock.

CLSA

CLSA has an "outperform" rating on Bank of Baroda with a price target of ₹335 per share.

It said the fourth quarter profit before tax is in line but had several one-offs including interest on IT refund, employee provision reversals and floating provisions. Its core performance was mixed.

The lender's fee income was down despite healthy loan growth performance, the brokerage said.

The management has guided for 2.75%-2.95% NIMs in FY27 and expects similar interest on IT refunds through FY27 as well.

JPMorgan

The brokerage has an "overweight" rating on Bank of Baroda with a price target of ₹335 per share.

It said the fourth quarter core operating performance was better compared to the brokerage's estimate with broad-based beats across NIM, recoveries and opex.

The retail, agri and MSME (RAM) segments were the key growth drivers with 5.9%, 6.3% and 4.2% sequential growth, respectively, with their share rising to 61% of the domestic advances as growth focus is likely to remain high in this segment for granular and NIM accretive growth, JPMorgan said.

However, JPMorgan does not see this deposit growth lagging loan growth as a constraint. The management expects loan growth to be between 12% - 14% in FY27, which is in-line with JPMorgan's 13.5% estimate.

Kotak Institutional Equities

The brokerage has an "add" rating on the stock with a price target of ₹300 apiece.

It said Bank of Baroda reported 10% earnings growth, although several line items that are usually hard to forecast drove the better-than-expected performance. Its NIM increased 10 basis points from the previous quarter, while its slippages stood at 1%, with its management comfortable that the West Asia exposure remains manageable at this stage.

Barring adverse macro-outcomes, the management expressed confidence in raising FY27 growth guidance while maintaining operating ratios unchanged, the brokerage said.

BoFA Securities

The brokerage has a "buy" rating on Bank of Baroda with a price target of ₹315 per share.

It said NIM expansion was supported by better investment yields and IT refund income. Higher provisions were led by 43 basis points of floating provision.

Citi

The brokerage has a "buy" rating on the stock with a price target of ₹340 apiece.

It said the fourth quarter PAT of ₹5,620 crore was materially aided by one-offs, IT refund of ₹1,290 crore, recoveries from written-off accounts of ₹1,485 crore, dividend income of ₹290 crore and a ₹220 crore reversal of retirement benefit provisions.

The brokerage reported NIM expansion to 2.90%, though was largely IT-refund driven it said. Barring this, yield on advances contracted 12 basis points while credit on deposits were up 3 basis points, underscoring persistent core NIM pressure.

Jefferies

The brokerage has a "hold" rating with a price target of ₹295 per share on Bank of Baroda

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it said the lender's fourth quarter profit of ₹5,600 crore was up 11% from last year, which was ahead of estimates and included many non-core gains that were partly used to make floating provisions.

It said loans grew by 16% and NII growth of 9% included some interest on tax refund.

The loan-to-deposit ratio of 83% and bulk deposit share at 23% of domestic deposit is higher than its PSU peers, Jefferies said.

IIFL Downgrades

Despite the bullish recommendations, IIFL has downgraded Bank of Baroda to "reduce" from its earlier rating of "add" and cut its price target to ₹282 from ₹340 earlier.

The brokerage has cut its earnings estimates for Bank of Baroda across financial year 2027-2028 by 4%, which are now 20% below consensus estimates. It expects valuations to remain depressed due to subdued profitability.

Stock reaction

Of the 39 analysts who have coverage on the stock, 32 have a "buy" rating, five have a "hold" rating and two have a "sell" rating.

Shares of Bank of Baroda are trading little changed at ₹264.35 in early trading on Monday. The stock is down 12% so far in 2026.

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