The Jammu & Kashmir Bank Ltd. is Rated Hold by MarketsMOJO

Current Rating and Its Significance

MarketsMOJO currently assigns The Jammu & Kashmir Bank Ltd. a 'Hold' rating, indicating a neutral stance on the stock. This rating suggests that investors should maintain their existing positions rather than aggressively buying or selling. The 'Hold' recommendation reflects a balanced view of the bank’s prospects, considering both its strengths and areas of caution. It is important to note that this rating was revised from 'Buy' to 'Hold' on 02 December 2025, accompanied by a decrease in the Mojo Score from 72 to 58, signalling a more cautious outlook based on recent evaluations.

Here's How the Stock Looks Today

As of 07 February 2026, The Jammu & Kashmir Bank Ltd. exhibits a mixed but stable profile across key parameters that influence its rating. The Mojo Score of 58 aligns with the 'Hold' grade, reflecting moderate confidence in the stock’s near-term performance. The stock has experienced a slight decline of 0.72% on the day, with a one-year return of 1.05%, indicating modest appreciation over the past twelve months.

Quality Assessment

The bank’s quality grade is classified as 'good', underpinned by strong lending practices and prudent risk management. Notably, the Gross Non-Performing Assets (NPA) ratio stands at a low 3.00%, which is a positive indicator of asset quality and credit discipline. This low NPA ratio suggests that the bank has effectively managed its loan portfolio, limiting the impact of bad debts on its balance sheet. Additionally, the bank’s promoters hold a majority stake, which often translates into stable governance and strategic continuity.

Valuation Perspective

Valuation metrics for The Jammu & Kashmir Bank Ltd. are currently very attractive. The stock trades at a Price to Book Value (P/BV) of 0.7, indicating it is priced below its book value and potentially undervalued relative to its peers. This discount offers an appealing entry point for value-oriented investors. The Return on Assets (ROA) is 1.2%, which, while modest, supports the valuation attractiveness. However, the Price/Earnings to Growth (PEG) ratio is relatively high at 5.3, suggesting that the stock’s price may not fully reflect its earnings growth potential, warranting cautious consideration.

Financial Trend and Profitability

The financial trend for the bank remains positive, with net profit growing at an impressive annual rate of 69.76%. This robust profit growth highlights the bank’s ability to expand its earnings base effectively. The latest quarterly results for December 2025 reinforce this trend, with interest earned reaching a record high of ₹3,313.44 crores and the credit-deposit ratio climbing to 72.85%, signalling healthy credit growth and efficient utilisation of deposits. Despite these encouraging figures, the stock’s price appreciation has been modest, reflecting market caution.

Technical Analysis

From a technical standpoint, the stock is rated as mildly bearish. Recent price movements show slight declines over the short term, including a 1.38% drop over the past week and a 1.10% decrease in the last month. However, the stock has managed to post small gains over three and six months (+0.49% and +1.67%, respectively) and a year-to-date increase of 2.99%. These mixed signals suggest some short-term selling pressure but a generally stable medium-term outlook.

Implications for Investors

For investors, the 'Hold' rating on The Jammu & Kashmir Bank Ltd. implies a wait-and-watch approach. The bank’s strong fundamentals, attractive valuation, and positive financial trends provide a solid foundation. However, the mildly bearish technical signals and the relatively high PEG ratio counsel prudence. Investors should monitor upcoming quarterly results and broader market conditions to reassess the stock’s potential for appreciation or risk.

Summary of Key Metrics

The Jammu & Kashmir Bank Ltd. currently holds a Mojo Score of 58, reflecting a balanced outlook. Its quality grade of 'good' is supported by a low Gross NPA ratio of 3.00%, while the valuation grade is 'very attractive' due to a P/BV of 0.7 and ROA of 1.2%. The financial grade is 'positive', driven by strong profit growth and record interest income. Conversely, the technical grade is 'mildly bearish', indicating some short-term price weakness. The stock’s one-year return of 1.05% and year-to-date gain of 2.99% suggest modest market performance amid these fundamentals.

Outlook and Considerations

Investors should consider the bank’s solid fundamentals and attractive valuation as reasons to maintain their holdings, while also being mindful of the technical signals that advise caution. The bank’s ability to sustain profit growth and maintain asset quality will be critical in determining whether it can transition back to a more bullish stance. Monitoring macroeconomic factors affecting the banking sector and regulatory developments will also be essential for a comprehensive investment decision.

Conclusion

The Jammu & Kashmir Bank Ltd.’s 'Hold' rating by MarketsMOJO as of 02 December 2025 reflects a nuanced view of the stock’s prospects. As of 07 February 2026, the bank demonstrates strong lending quality, very attractive valuation, and positive financial trends, balanced against some technical caution. This rating advises investors to maintain their current positions while closely observing future developments that could influence the stock’s trajectory.

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