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1. AMN Capital   I Like It. |Report Abuse|  Link|Aug 16, 2022 12:06:38 PMReply
The stock of Federal Bank has given good returns in recent months. The stock is up 23 percent over the last two months, a large outperformance when compared to the 6.6 percent gain made by Nifty Bank Index over the same period.

Federal Bank reported its June 2022 quarter results last month and the results were satisfactory which could be one of the reasons for the stock’s recent outperformance. The June 2022 quarter results exhibited a positive trend in earnings growth and asset quality metrics which were evident in the previous quarter too.

Despite the recent gains, the stock price performance of Federal Bank over the last five years was a big disappointment. The stock price has remained unchanged over the last five years. The current market price is the same as it was five years ago (in 2017). Meanwhile, major business parameters of Federal Bank grew at reasonable rate during the five-year period.

In the case of Federal Bank, I find three recent developments that have the potential to change investor perception regarding Federal Bank for the better. This could result in the stock of Federal Bank outperform the general market over the next 1 – 2 years. They are:

Lower Provisions and Improving Asset Quality
Higher Dividend payment for FY2021-22
High growth in Advance in June 2022 quarter

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