Bandhan Bank Ltd. is Rated Sell

Current Rating and Its Context

On 31 October 2025, MarketsMOJO revised Bandhan Bank Ltd.’s rating from 'Hold' to 'Sell', reflecting a significant change in the stock’s outlook. The Mojo Score, a composite indicator of the stock’s overall health, dropped by 18 points from 51 to 33, signalling increased caution for investors. This rating encapsulates a comprehensive evaluation of the company’s quality, valuation, financial trend, and technical outlook.

Here’s How Bandhan Bank Looks Today

As of 20 January 2026, Bandhan Bank’s financial and market data present a challenging picture. The stock has experienced a steady decline over recent months, with a one-year return of -7.73% and a six-month drop of -25.08%. The year-to-date return also stands negative at -3.77%, indicating continued pressure on the share price. Daily and weekly movements remain bearish, with the stock down 1.54% on the latest trading day and 2.23% over the past week.

Quality Assessment

Bandhan Bank’s quality grade is currently rated as 'good', suggesting that the company maintains a reasonable standard in its core operations and governance. However, this positive aspect is overshadowed by other factors weighing on the stock. The bank’s credit-deposit ratio, a key indicator of lending efficiency, has declined to 85.15% in the half-year period, the lowest in recent times. This signals a cautious lending approach or slower credit growth, which may impact future profitability.

Valuation Perspective

The valuation grade is marked as 'attractive', implying that the stock is trading at a relatively low price compared to its intrinsic value or sector peers. This could present a potential entry point for value investors. Nevertheless, attractive valuation alone does not offset the risks posed by deteriorating financial trends and technical weakness, which are critical to consider before investing.

Financial Trend Analysis

The financial trend for Bandhan Bank is categorised as 'very negative'. The latest quarterly results reveal a sharp decline in profitability metrics. Profit before tax excluding other income (PBT LESS OI) plunged to a loss of ₹388.65 crores, a fall of 270.4% compared to the previous four-quarter average. Similarly, profit after tax (PAT) dropped by 78.2% to ₹111.87 crores. These figures highlight significant earnings pressure and raise concerns about the bank’s near-term financial health.

Additionally, promoter confidence appears to be waning, with promoters reducing their stake by 0.63% over the previous quarter to 40.29%. Such a reduction may indicate diminished faith in the company’s future prospects, which can influence market sentiment negatively.

Technical Outlook

The technical grade for Bandhan Bank is 'bearish', reflecting weak price momentum and negative chart patterns. The stock has consistently underperformed the BSE500 benchmark over the past three years, including a 5.91% negative return in the last year alone. This persistent underperformance suggests that the stock is facing sustained selling pressure and lacks positive catalysts to reverse the trend in the short term.

What the 'Sell' Rating Means for Investors

MarketsMOJO’s 'Sell' rating on Bandhan Bank Ltd. indicates that the stock is currently expected to underperform relative to the broader market and sector peers. This recommendation is based on a holistic assessment of the company’s fundamentals, valuation, financial trajectory, and technical signals. While the valuation appears attractive, the very negative financial trend and bearish technical outlook suggest caution.

Investors should be aware that the bank’s recent earnings weakness and declining promoter confidence may pose risks to capital appreciation in the near term. The 'Sell' rating advises investors to consider reducing exposure or avoiding new positions until there are clear signs of financial recovery and technical improvement.

Sector and Market Context

Bandhan Bank operates within the private sector banking space, a competitive and dynamic industry segment. Despite the sector’s overall growth prospects, Bandhan Bank’s recent underperformance relative to the BSE500 index highlights company-specific challenges. The bank’s credit-deposit ratio and profitability metrics lag behind some peers, which may affect investor sentiment and valuation multiples.

Summary of Key Metrics as of 20 January 2026

To summarise, the stock’s key performance indicators as of today include:

• One-day price change: -1.54%


• One-week price change: -2.23%


• One-month price change: -6.56%


• Three-month price change: -15.99%


• Six-month price change: -25.08%


• Year-to-date price change: -3.77%


• One-year price change: -7.73%


• Credit-deposit ratio (half-year): 85.15%


• Promoter stake: 40.29% (down 0.63% from previous quarter)

These figures reinforce the cautious stance reflected in the current 'Sell' rating.

Investor Takeaway

For investors, the current rating and analysis suggest that Bandhan Bank Ltd. is facing headwinds that may limit near-term upside potential. While the stock’s valuation is appealing, the financial and technical challenges warrant a prudent approach. Monitoring upcoming quarterly results and any shifts in promoter activity will be important to reassess the stock’s outlook going forward.

In conclusion, the 'Sell' rating serves as a signal to carefully evaluate risk exposure in Bandhan Bank and consider alternative opportunities within the banking sector or broader market until the company demonstrates a sustained turnaround.

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