Fitch revises outlook on 9 Indian banks' IDRs from stable to negative

Action follows change in outlook on India's rating.

Global rating agency Fitch on Monday revised the outlook from “stable” to “negative” on the Long-Term Issuer Default Ratings (IDR) of nine Indian banks following revision in the outlook on India rating ('BBB-'). It affirmed rating on IDRs, Support Ratings (SR) and Support Rating Floors (SRF).

The rating action covers nine banks - State Bank of India (SBI), Bank of Baroda (BOB), BOB’s subsidiary in New Zealand, Bank of India (BOI), Canara Bank (Canara), Punjab National Bank (PNB), ICICI Bank (ICICI), Axis Bank (Axis) and Export-Import Bank of India (EXIM).

The IDRs for Indian banks are support-driven and anchored to their respective SRFs. They are based on assessment of high to moderate probability of extraordinary state support for these banks. This takes into account our assessment of the sovereign's ability and propensity to provide extraordinary support, Fitch said in a statement.

The rating action does not affect the banks' Viability Ratings (VRs). EXIM does not have a VR as its role as a policy bank makes an assessment of its standalone credit profile less meaningful.

On June 18, 2020, Fitch changed outlook on India to Negative from Stable due to the impact of the escalating coronavirus pandemic on India's economy.

The Negative Outlook on India's reflects an increasing strain on the state's ability to provide extraordinary support. The sovereign has limited fiscal space and there has been significant deterioration in fiscal metrics due to challenges from the Covid-19 pandemic, rating agency added.

Covid-19 crisis: SBI to disburse Rs 700 cr to MSMEs in Mumbai by June

Among all banks, SBI controls a market share of 22% in the MSME lending.

State Bank of India (SBI), the country's largest lender, has set a target of disbursing Rs 700 crore to MSMEs in the Mumbai circle by the end of June, to help them tide over liquidity crisis due to the Covid-19 lockdown.

Among all banks, SBI controls a market share of 22 per cent in the MSME lending.

"SBI will boost flow of credit to MSMEs (micro, small and medium enterprises) in this challenging period by reassessing their working capital limit and also by extending Covid-19 emergency loans.

"Overall, we expect to lend Rs 700 crore to MSMEs in four districts of Mumbai circle — Mumbai, Thane, Palghar and Raigad — by the end of June," the World Trade Centre said in a statement quoting Suresh Nair, deputy general manager (SMEs and financial inclusion) at SBI, as saying after a webinar.

ALSO READ: SBI, ICICI Bank: Are financial sector stocks a good bet post RBI measures?

Nair expressed hope that the pandemic will not lead to a sudden spurt in bad loans as the Reserve Bank of India has provided moratorium on all loan repayments.

"The impact of the crisis on NPAs (non-performing assets) will become clear after August depending on the evolving situation," Nair said.

Though SBI has provided sanction letter for additional loan facility to 67 per cent of all eligible borrowers, only 50 per cent of them could avail of the facility due to practical difficulties in executing documentation, he said.

SBI to invest Rs 7,250 cr in crisis-hit YES Bank as part of RBI rescue plan

Under the reconstruction scheme, SBI is to buy up to 49 per cent of YES Bank and cannot reduce its holding below 26 per cent for the next three years.

State Bank of India (SBI) on Thursday said it would infuse Rs 7,250 crore into ailing YES Bank to pick up to 49 per cent equity as part of the Reserve Bank of India-mandated bailout plan.

SBI will pick 7,250 million shares at Rs 10 each, and its shareholding will remain within 49 per cent of the paid-up capital of the private sector lender.

Under the restructuring scheme, the authorised capital shall stand altered to Rs 5,000 crore.

The number of equity shares will stand altered to 24,000 million of Rs 2 each aggregating to Rs 4,800 crore.

SBI’s stake in altered capital is expected to be 30 per cent, going by the restructuring scheme. “The executive committee of the central board at its meeting on March 11 accorded approval for purchase of 7,250 million shares of YES Bank at a price of Rs 10 a share, subject to regulatory approvals,” SBI said in an exchange filing on Thursday.

Under the reconstruction scheme, SBI is to buy up to 49 per cent of YES Bank and cannot reduce its holding below 26 per cent for the next three years. The SBI investment of Rs 7,250 crore is much higher than the Rs 2,450 crore it had planned initially for 49 per cent stake in the private sector lender.

Last week, SBI Chairman Rajnish Kumar had said the bank would invest Rs 2,450 crore to buy 2,450 million shares of YES Bank. SBI was also in talks with other investors, and SBI investment would not exceed Rs 10,000 crore.

On March 5, the RBI had imposed a moratorium on YES Bank, restricting withdrawals to Rs 50,000 per depositor till April 3.

The RBI also superseded the board and placed it under an administrator, Prashant Kumar, who is a former deputy managing director and chief financial officer of SBI.

The administrator will take on board results for third quarter on Saturday. The final restructuring scheme is expected to be finalised on Friday.

YES Bank is banking on investment by SBI, speedy resolution with support from the RBI and SBI, and fundraising plans to instil confidence among customers, according to administrator.

ICAI to review YES Bank's financial statements for FY18 and FY19

Firms say there are limits to audits identifying ever-greening of loans, or flagging suspect collateral securities.

The spotlight is back on the role of auditors in flagging the ongoing crisis at YES Bank. The accounting standard regulator, the Institute of Chartered Accountants of India (ICAI), plans to review the financial statements of YES Bank for the financial year 2017-18 (FY18) and FY19, and check whether there have been any lapses on the part of the auditors.

The audit fraternity points out that one of the key challenges in undertaking audit of banks relates to reconciling divergences between the Reserve Bank of India (RBI) and the banks when it comes to recognition of non-performing assets (NPAs).

“Over the last two-three years we have been under a lot of pressure from the RBI in matters relating to divergences. As a result, whenever in doubt we approach the RBI for guidance on suspect transactions,” said an auditor from one of the Big Four audit firms.

The auditors are also increasingly seeking information on a group’s loan exposure, than just the company they have the audit mandate for.

An RBI assessment for FY16 pegged the NPAs of YES Bank at Rs 4,925 crore as against the Rs 748 crore gross NPAs reported by the bank. The divergence ballooned to Rs 6,335 crore at the end of FY17.

To check instances of evergreening of loans, auditors said they have started keeping a tab on the money trail of loan payback. “We have started taking a close look at where the money is coming from,” said the audit head of another Big Four firm.

ALSO READ: ED probes Rana Kapoor's role in YES Bank's Rs 30,000-cr bad loans

However, the auditor fraternity concedes that as statutory auditors there are limits to which they could check the money trail. They also rue lack of guidance in this respect from the accounting standard regulator.

What auditors also find challenging is to ascertain intrinsic value of securities that are put forth against loans. “This is more so in an economic environment where repayment power of business is weak,” said another audit professional. Statutory auditors of YES Bank have already had a rough ride over the past few years. BSR & Co, an affiliate of KPMG India, is the current auditor of YES Bank. However, the previous auditor, SR Batliboi & Co, an EY affiliate, was hauled up by the RBI on account of lapses in statutory audit. Following this, the firm was banned for one year from carrying out statutory audit assignments of commercial banks.

YES Bank fallout: Axis Trustee Services seeks clarity on AT-1 bondholders

RBI's draft reconstruction scheme for YES Bank suggested a permanent write-down of these bonds outstanding as of March 5.

YES Bank Share : Axis Trustee Services, the debenture trustees for YES Bank’s additional tier-1 (AT-1) bond, has written to the Reserve Bank (RBI) seeking clarity on the fate of the AT-1 bondholders. It also asked for appropriate treatment for them in the larger interest of debt capital markets and future bankfundraising.

RBI’s draft reconstruction scheme for YES Bank suggested a permanent write-down of these bonds outstanding as of March 5. According to the draft, the write-down is “in conformity with the extant regulations issued by the RBI based on the Basel framework”.

“We submit that such write-down of the AT-1 bonds, if given effect to, will be an arbitrary and discriminatory decision. While the Basel-III framework does legally permit write-off of the AT-1 bonds or conversion of such instruments into equity, such power ought not to be exercised in a manner in which preference is given to the common equity holders at the cost of retail as well as other investors who have directly or through mutual fund schemes and regulated financial institutions subscribed to the bonds,” Axis Trustee said.

In a letter to the RBI, Axis Trustee has presented the central bank with alternatives that can be looked at instead of writing down the AT-1 bonds. YES Bank has issued AT-1 bonds worth Rs 8,920 crore.

They have said, since the draft scheme of the RBI for reconstruction of YES Bank sees the matter as a going concern, the bank will always have the discretion to cancel or suspend coupon payments and delay the exercise of call option till the time the financials of the bank improves.

Also, they have said global best practices place equity as subordinate to AT-1 bonds but the RBI should consider the AT-1 bonds at par with equity if not senior. And, the AT-1 bonds can be converted into equity without affecting the size of the stake and value of investment of State Bank of India.

AT-1 bondholders have been holding on to the bonds for the past 3-4 years as long-term investors, the letter said. Moreover, in all the various scenarios in which the bonds can be converted into equity, the bondholders would be subjected to serious loss absorption in the range of 70-80 per cent of face value, however, that would be more equitable and acceptable than the proposed write down.

Statsguru: How PSBs deal with integration in a challenging biz environment

The RBI in December 2019 noted that private sector banks accounted for 69 per cent of incremental loans in 2018-19.

The announcement of swap ratios for the combination of 10 public sector banks (PSBs) into four has put the spotlight on such unions, and how they have fared before. Analysts would be keenly watching as to how the entities deal with the integration in a challenging business environment.

Each of the 10 banks participating in the process has more bad loans than it did five years ago, though much of it is to do with better disclosures. The slowing economy has reduced credit offtake. Bad loan ratios are expected to largely worsen for the anchor banks, though net non-performing assets show a decline for some. This also holds true for capital adequacy. The anchor banks will see their capital cushion decline in at least two instances, show analyst estimates.

However, this is not unique to the latest exercise. Previous attempts of bringing together PSBs may have helped the weaker ones, but tended to weigh on the anchor banks. The State Bank of India saw its net non-performing assets go up after its 2017 merger with its associate banks and the Bharatiya Mahila Bank.

This was also true for Bank of Baroda’s 2019 merger with Dena Bank and Vijaya Bank The capital adequacy ratio also declined in both instances

The latest set of mergers is likely to take time to iron out the kinks, suggest analysts. The Reserve Bank of India in December 2019 noted that private sector banks accounted for 69 per cent of incremental loans in 2018-19. They also had a similar share in deposits. It remains to be seen if bigger PSBs would be able to protect market share.

YES Bank fallout: SBI Cards may see some negative impact on listing

A plan to infuse capital in YES Bank where it continues to function as a separate entity just like LIC investing in IDBI Bank, would be a big positive for all the concerned stakeholders, analysts say.

Newsflow around State Bank of India (SBI) stepping in to rescue the cash-starved YES Bank has triggered a fresh sell-off in the state-owned bank's counter. While YES Bank tanked 80 per cent in intra-day deals, SBI lost over 10 per cent.

The developments have also cast a shadow on the listing of the bank's credit card arm - SBI Cards & Payment Services - which was expected to list at up to 50 per cent premium against the issue price.

ALSO READ: Taxpayers will be 'big casualty' if govt bails out Yes Bank: Macquarie

While analysts continue to remain bullish on SBI Cards from a long-term perspective given its healthy business outlook and huge penetration scope, the recent developments may have an impact on SBI Cards' listing. That said, they advise using the overhang to buy the stock for the long-term.

"If YES Bank gets amalagamated with SBI, just like Global Trust Bank (GTB) with Oriental Bank of Commerce (OBC) back in 2004, then it will be negative for both YES Bank shareholders as well as SBI shareholders. SBI then would have to take charge of all the liabilities of YES Bank. It will be negative for YES Bank shareholders as they would be left with nothing. However, it would be too early to jump the gun and conclude anything right now," explains Ambareesh Baliga, an independent market analyst.

On the other hand, a plan to infuse capital in YES Bank where it continues to function as a separate entity just like LIC investing in IDBI Bank, would be a big positive for all the concerned stakeholders, the analyst says.

Bank unions oppose mega bank merger, to go on strike on March 27

Venkatachalam alleged that govt's decision to merge 10 banks would lead to the closure of six banks - Andhra Bank, Allahabad Bank, Corporation Bank, Oriental Bank of Commerce, Syndicate Bank and United.

All India Bank Employees’ Association (AIBEA) and All India Bank Officers Association (AIBOA) have decided to go on strike on March 27 against the government's decision to go for a mega bank merger, which was approved by the Cabinet on Wednesday.

“Banks are themselves facing problems due to the huge pile of bad loans.

While the public sector banks made a total gross profit of Rs 150,000 crore for the year ended 31-3-2019, because of total provisions towards bad loans, etc amounting to Rs. 216,000 crore, the banks ended with a net loss of Rs. 66,000 crore,” said C H Venkatachalam, general secretary, AIBEA.

“Can anyone believe that the merger of banks will result in recovery of the huge corporate bad loans?

Rather, as we saw, after merger in State Bank of India (SBI), bad loans in SBI have gone up. These banks are facing the same risk now,” he said.

Meanwhile, Venkatachalam alleged that the merger of 10 banks simply meant that six banks - Andhra Bank, Allahabad Bank, Corporation Bank, Oriental Bank of Commerce, Syndicate Bank and United Bank of India would be closed down.

SBI cuts MCLR for ninth straight month making auto, home loans cheaper

The bank also reduced interest rate on term deposits - retail and bulk - by 10-50 basis points (bps) across various tenors.

India's largest lender State Bank of India (SBI) has decided to reduce its Marginal Cost of Funds based Lending Rate (MCLR) by five bps across all tenors. The one year MCLR comes down to 7.85 per cent per annum (p.a) from 7.90 per cent per annum with effect from 10th February 2020. This is the ninth consecutive cut in MCLR in FY 2019-20, SBI said in statement. This will lead to a reduction in home and auto loan rates.

The lender also decided to slash interest rate on term deposits – retail and bulk – by 10-50 basis points (bps) across various tenors as it is sitting on a pool of surplus funds. The revised rates will come into effect from February 10, 2020.

The bank's credit grew by 6.8 per cent to Rs 23, 01, 669 crore in 12 months ended December 2019, driven by Retail-Personal Advances which clocked a growth of 17.49 per cent.

SBI chairman Rajnish Kumar in January 2020 had said, at the start of year bank had given guidance of 10-12 per cent growth in advances in FY20. But will be difficult to reach 10 per cent mark, reflecting weak demand for corporate credit.

Referring to resource position, SBI in a statement said, in view of surplus liquidity in the system, bank will realign its interest rate on Retail Term Deposits (less than Rs two crore) and Bulk Term Deposits (Rs two and above) February 10, 2020.

Its deposits rose by 9.9 per cent to Rs 31,11,229 crore in 12 months ended December 2019. The share of low cost deposits – current account and savings account – in total deposits declined by 51 basis points to 44.72 per cent in December 2019 from 45.23 per cent a year ago.

According to Reserve Bank of India, overall liquidity in the system remained in surplus in December 2019 and January 2020.

Average daily net absorption under the liquidity adjustment facility (LAF) amounted to Rs 2.61 trillion in December 2019.

How opportunistic behavior can worsen India's $200 bn-plus bad loan crisis

A capital-constrained economy like India can't afford a jungle raj in finance.

Snatch-and-grab is the new hallmark of Indian finance. As a banker friend in Mumbai put it to me only half-jokingly, a unit of "grabbed" cash collateral in hand is worth more than two units of hypothetical receivables.

Yet this is no laughing matter. Not only is opportunistic behavior going to worsen India’s $200 billion-plus bad loan crisis, but now that everyone from the government’s sleuths to the courts are joining the melee, the ensuing chaos will limit the recovery for lenders and threaten depositors.

Rajnish Kumar, chairman of State Bank of India, sat down for a chat with me at the Bloomberg Equality Summit in Mumbai this week. He had highlighted the problem last month by blaming what he called the selfishness of one bank for a default by Altico Capital India Ltd., a nonbank lender to property builders. When asked why his HDFC Bank Ltd. had choked Altico by helping itself to the money the shadow financier had raised elsewhere and parked with him, Aditya Puri, the managing director of India’s most valuable lender, replied: “What is out-of- turn? It is my security and I will exercise it.”

Now the regulator, the Reserve Bank of India, will decide whether Kumar’s unhappiness is a case of sour grapes or if Puri did indeed cross a line. For State Bank of India, Altico is just one of the several instances where the taxpayer-funded bank has been at the receiving end.

SBI didn’t drag tycoon Anil Ambani’s Reliance Communications Ltd. to an in-court bankruptcy process, hoping instead that Ambani would be able to sell assets to his brother Mukesh, India’s richest man, out of court. Ericsson AB, an operational creditor, pursued the opposite strategy and got itself a very decent court-enforced settlement by invoking the younger Ambani’s personal guarantee.

More recently, SBI’s Kumar received a fresh blow when India’s enforcement directorate, tasked to fight economic crime, attached the assets of insolvent Bhushan Power & Steel Ltd. on suspicion of money laundering by its previous management. Both the new owner, who won control of Bhushan during bankruptcy, and Kumar, who’s waiting for his check, are impatient. Yet, thanks to the enforcement directorate, the $2.8 billion sale has now been put on hold by an adjudicating authority.

Business Standard

NCLT sets 90-day deadline for Jet Airways bankruptcy resolution

Jet stopped operations on April 17 leaving over 14,000 employees in the lurch.

The National Company Law Tribunal (NCLT) on Thursday admitted the insolvency petition moved by State Bank of India (SBI) — under section 7 of the Insolvency and Bankruptcy Code (IBC) — against Jet Airways, and instructed that the resolution process be wrapped up in 90 days as the matter is of national importance.

Typically, the corporate insolvency resolution process (CIRP) should be completed in 180 days, and an extra 90 days’ time is granted in case the process doesn’t conclude in the stipulated period. The interim resolution professional (RP) has been instructed to submit fortnightly progress reports on the CIRP process, with the first to be filed on July 5, the day of the next hearing.

The tribunal also declared a moratorium on recovery of dues from Jet, the country’s first aviation firm to be admitted for bankruptcy. Jet had over 120 planes, of which only about a dozen have not been de-registered by the civil aviation regulator. The rest of the planes had their leases terminated and many of them have been inducted by other airlines in India or abroad.

Also, on a day which saw the beleaguered airline being admitted under the insolvency process, Jet shares posted their highest single-day gain on the bourses on Thursday, rising 93 per cent on the BSE to end at Rs 64 after declining 75 per cent in the previous 10 sessions. Such a movement in share prices is highly unusual.

ALSO READ: Jet Airways: Exit is best

Moreover, presiding judges V P Singh and Ravi Kumar Duraisamy did not take cognizance of the Dutch court order that had declared Jet bankrupt, given that cross-border insolvency is still not in place under the IBC and because the jurisdiction of the corporate debtor rests with the tribunal (as the company is listed in India).

SBI, in its plea, said the airline had defaulted on working capital loans of up to Rs 970 crore. Jet had a working capital facility of Rs 505 crore. This account was overdrawn by around Rs 460 crore for 30 days. The lender had also provided a term loan facility of Rs 1,292 crore to the carrier, which owes over Rs 8,000 crore to a consortium of 26 lenders.

Business Standard

Government or state banks - who is to blame for India's slowdown?

After elections, the next government should not dodge the need for more radical reforms.

Business Standard : India, the world's fastest growing large economy, is slowing: There has been a visible deceleration in activity in the past six months. It started with slowing sales of autos and some durable goods and has spread from there. Airline traffic growth is down; companies are now saying sales of consumer staples such as soaps and detergents have begun to weaken, too. Even as the hunt for reasons for the slowdown begins, the main culprit appears to be a familiar one: the still largely government-owned financial system.

The issue is that there isn’t enough money in the economy. For much of the past two years, distributors and retailers of consumer products have been warning of a growing lack of liquidity. At first, policymakers largely dismissed their concerns. The government's late 2016 decision to withdraw most currency from circulation temporarily, and the introduction the following year of a nationwide goods-and-services tax, made it hard to decipher signals on economic momentum. Plus, liquidity, as the central bank measures it, generally looked stable: Banks were still parking funds with the Reserve Bank of India overnight.

Now that the GST is more than a year old and the effects of demonetization have faded, the growth numbers are less distorted by base effects and the slowdown is becoming more obvious. So is the lack of liquidity: For the past two years, growth in money supply, as measured by M3, has lagged GDP growth; the M3-to-GDP ratio has declined sharply from 85 per cent to below 80 per cent. Though aggressive purchases of government bonds by the RBI have caused base money or M0 (much of which is currency in circulation) to grow at 16 per cent in recent months, it is still about 1 percentage point of GDP lower than its level before demonetization.

Obviously, the engine that converts the 28 trillion rupees of base money (M0) to the 154 trillion rupees available as broad money (M3) is malfunctioning. The bottleneck is in the financial system. Money gets created when loans are given and, even though bank credit growth has accelerated in the past few months, aggregate credit growth is still far too weak.

A reluctance to privatize the financial system is to blame. State banks continue to dominate the sector, controlling some two-thirds of banking assets. They also accounted for nearly 90 per cent of the non-performing assets from the last lending boom. While all sides of the political spectrum acknowledge the need for reform, governments have shied away from selling off state lenders outright, preferring to reform the sector by stealth. The hope has been to slow the growth of state-owned banks and allow privately owned rivals to gain market share.

SBI buys loans worth Rs 27,000 cr from non-banking financial cos in FY19

Flush with funds, SBI in October 2018 had tripled its target to buy good quality retail asset portfolio from finance companies to Rs 450 billion from earlier target of Rs 150 billion.

State Bank of India has acquired retail loans worth Rs 27,000 crore including Rs 10,000 crore worth of micro-finance loans from non-banking finance entities in 2018-19.

India's largest lender SBI in October 2018 had indicated it would acquire up to Rs 45,000 crore from finance companies that are facing a liquidity crunch after IL&FS group entities defaulted on repayments. This provided much-needed funding support to finance companies.

P K Gupta, managing director (digital and retail banking) said the bank has sanctioned Rs 27,000 crore of loans which were to be bought from finance companies. Of this, work for over Rs 19,500 crore has already has been done. The processing for over Rs 6,000 crore is underway.

These assets comprising mortgage loans and microfinance credit etc have been acquired through the direct assignment route. They would be part of the loans book, unlike securitization where banks invest in the pass through certificates for underlying loans.

SBI got an opportunity to expand its loan book by purchasing good quality portfolio assets at attractive rates.

The yield on loan portfolio ranges between 8.75 per cent to 10.5 per cent depending on the profile of the asset pool and competition, SBI executives said.

The loan purchase was for expanding the book but not at the cost of the growing balance sheet organically through branch network, SBI chairman Rajnish Kumar had said.

The credit to deposit ratio of SBI stood at around 68.67 per cent at end of December 2018. Gross Advances at the Whole Bank level registered a growth of 11.99 per cent from Rs 19.24 trillion as on December 2017 to Rs 21.55 trillion as on December 2018.

Bank deposits increased 6.76 per cent from Rs 26.51 trillion in December 2017 to Rs 28.30 trillion in December 2018.

Business Standard

SBI, Bank of Baroda, PNB: Here's how you can make money in PSU bank stocks

SBI has a strong relevance of 200-weekly moving average (WMA), as it has never been decisively broken in the last one year.

Business Standard : The benchmark indices witnessed a sharp rally, rising over 3 per cent in the last week. The S&P BSE Sensex rose 1353 points, or 3.65 per cent, to close at 38,024, hile the Nifty50 rose 391 points, or 3.54 per cent, to end at 11,246.

The overall trend was spearheaded by Nifty Bank, which soared 1620 points, or 5.80 per cent. The index witnessed strong buying on every new lifetime high levels. Along with private banks, investors showed keen interest PSU banks started showing the keen interest of investors with a jump in volumes and a change in trend.

NIFTY PSU BANK (NIFTYPSUBA): The index needs to strongly hold above 2950 levels to maintain the positive sentiment. Any breach on the same may trigger a sell-off. A bigger move is expected only above 3,200. The recent rally from Rs 2700 to Rs 3000 levels has been a straight rise without any confirmed breakout. The the last six months, the Nifty PSU Bank index has been hovering around its 200-days moving average (DMA) as per daily chart.

STATE BANK OF INDIA (SBI): The stock has a strong relevance of 200-weekly moving average (WMA), as it has never been decisively broken in the last one year. The formation resembles a symmetrical triangle with immediate trendline resistance at Rs 310 level. The 200 WMA is placed at Rs 260, which acts as a strong support from a medium-term perspective. The weekly MACD has just risen above zero line, indicating a possible upside. A firm rally above Rs 310 will open doors for Rs 340 and Rs 360 levels.

BANK OF BARODA (BANKBARODA): The bigger picture for the stock reveals negative sentiment on the chart. The falling channel pattern indicates selling pressure in the range of Rs 120 – Rs 125, its upper falling trend line. The 200-days moving average (DMA) coincides around the same range, placed at Rs 119.30 level. However, it has a support around Rs 112, a level where 100DMA and 50DMA in a process to make positive crossover. If it happens, the stock may cross its pressure range and head towards Rs 140 and Rs 150 level.

PUNJAB NATIONAL BANK (PNB): The current rally towards Rs 86 level is due to the strong buying seen around Rs 68, which has become a support for a-near term trading, technical chart suggests. The golden crossover of 50DMA and 200DMA has further strengthened the upward move. A possible crossover of 100DMA with 200DMA may even lead to a stronger rally in the near future. The immediate support comes in the range of Rs 75 – Rs 78 and the trend recommends a move towards Rs 94 and Rs 105 level.