J&K Bank share hit a 52 week high today at Rs 930, which is up 3.43 %. The rise in the share rode upon the optimistic view about the rate cuts announced by Reserve Bank of India (RBI) in its Annual Monetary Policy 2012-13.
With a view to boost growth, the Reserve Bank of India (RBI) has cut the policy rates by 50 basis points. The repo rate now stands at 8 % from 8.50 % earlier. Similarly, the reverse repo rate is now at 7 % from 7.50 % earlier.
Commenting upon the RBI move, chairman and CEO J&K Bank Mushtaq Ahmad said, “It is certainly a welcome step from the RBI to ensure more liquidity into the banking system through a repo rate cut. It will help banks like ours, which have immense regional and pan-India lending opportunities.
“We will be happy to pass on the benefit of cut to borrowers. Though seemed temporary, the initiative is an act of re-balancing towards checking inflation. The rate cut scenario will also allow us generate volumes, customer base and remain competitive outside the J&K State.”
Meanwhile, Ahmadabad based Broking House Shah Investors Home Ltd (SIHL) which is also a member of National Securities Depository Ltd (NSDL), has recommended `Buy` on Jammu & Kashmir Bank with a price target of Rs 1,056 as against the current market price (CMP) of Rs 922 in its report today.
SIHL has enumerated the Bank’s undisputed leadership in J&K state, business growth to pick up, significant improvement in asset quality, boost in CASA ratio and focus on J&K state as strong reasons for their recommendations.