Punjab National Bank and Shyam Metalics: Weekly Recommendations

The two stocks recommended by SMC Global Securities’ Research Team this week are Punjab National Bank and Shyam Metalics & Energy. These two stocks have shown great potential with positive financial estimates for the next two financial years. So, let’s go through the details of the two stock recommendations for the period between May 19, 2025 and May 23, 2025.

Punjab National Bank

Punjab National Bank share price is ₹98.90 (as on May 16, 2025) and its target price is set at ₹126 with an upside potential of 27%.

Punjab National Bank: Investment Rationale

• The business of the bank has increased 14% YoY to ₹26,83,260 crores end March 2025, driven by 14% surge in advances to ₹11,16,637 crores. Deposits rose 14% to ₹15,66,623 crores at end March 2025.
• Advances growth was driven by retail loans rising 17% YoY to ₹2,59,363 crores at end March 2025, while credit to agriculture increased 14% to ₹1,80,625 crores and MSME 17% to ₹1,62,693 crores at end March 2025.
• The corporate credit has moved up 10% to ₹4,63,367 crores end March 2025. The overseas credit has jumped 24% to ₹50,589 crores end March 2025.
• The CASA deposits of the bank increased 4% YoY to ₹5,73,543 crores at end March 2025. The current account deposits increased 4% to ₹75,114 crores, while savings account deposits also moved up 4% to ₹4,98,429 crores end March 2025.
• The CASA ratio declined to 36.6% at end March 2025 compared to 40.3% at end March 2024, while it remained nearly steady from 36.7% a quarter ago.

• Net interest income (NII) was at ₹10,757 crores, up 3.8% YoY while global net interest margin (NIM) reduced to 2.81% as on 31 March 2025 as compared to 3.10% as of 31 March 2024.
• The bank has continued to improve asset quality in Q4 FY2025. The ratio gross NPA declined to 3.95% as of 31 March 2025 as against 5.73% as on 31 March 2024. Net NPA reduced to 0.40% as on 31 March 2025 as compared to 0.73% as on 31 March 2024.
• Provision coverage ratio improved to 90.27% as on March 2025 as against 87.93% as on March 2024.
• The bank remains well capitalized and has sufficient headroom to take care of business growth requirements. CRAR stood at 17.01% as on March 2025 against 15.97% as on March 2024.
• Tier-I Capital was at 14.05% and Tier-II at 2.96% as on March 25. Further, the company’s board approved raising capital for an amount up to Rs 8,000 crore through issuance of Basel III compliant Bonds, to be raised in one or more tranches during FY 2025-26.
• The return on assets (ROA) stood at 1.02% for Q4 FY’25 and 0.97% for FY ’25, achieving the guidance for FY’25. Return on equity is 19.23% for Q4 FY’25 and 19.33% for FY’25.

Punjab National Bank: Shareholding Pattern

Promoters’ shareholding is highest in Punjab National Bank at 70.08%.

Punjab National Bank: Valuation

PNB has achieved strong business growth and improved asset quality in Q4 FY25, reflecting consistency, continuity, and long-term resilience.

It remains focused on strengthening core value drivers, with key priorities including customer centricity, ease of banking, enhanced branch ambiance, expansion across 100 districts, RAM market share growth, and better underwriting standards.

Thus, it is expected that the stock may see a price target of ₹126 in 8 to 10 months’ time frame on 1 year’s average P/BV of 1.07x and FY26 (E) BVPS of ₹117.60.

Punjab National Bank: Risk

• Economic Slowdown
• Deterioration in asset quality

Shyam Metalics and Energy Limited

Shyam Metalics and Energy share price is ₹933 (as on May 16, 2025) and its target price is set at ₹1,072 with an upside potential of 15%.

Shyam Metalics and Energy Limited: Investment Rationale

• Shyam Metalics is an integrated metal-producing company based in India, primarily in the steel Industry in West Bengal, Odisha, Girdih, and Madhya Pradesh with a focus on Long Steel Products, Ferro Alloys, Aluminum, and Stainless Steel.
• The company has the ability to sell intermediate and final products across the steel value chain. It is the sixth-largest integrated steel producer in India, with a production capacity of 15.13 million tonnes per annum (MTPA) as of FY25, and ranks among the largest producers of ferro alloys and the fourth-largest in sponge iron capacity.
• According to the management, the company has diversified its product line by launching its roofing sheets under the SEL Tiger brand in the March 2025 quarter. This launch further expands its value-added product portfolio, catering rising demand in the construction and industrial sectors.

• It has also ventured into a B2C market and launched a food grade aluminum foil under SEL Tiger Foil produced at its Jharkhand plant.
• With the demand of aluminum foil in the food business, the company expects the business to grow around 8% to 10% CAGR by 2030 and would be well positioned to capitalize on the rising demand and emerging opportunity in this sector. Besides, it further expands its product offerings and strengthening its presence in key markets.
• The company’s blast furnace facility in Jamuria also got commissioned in Q3 FY’25 and continue to operate efficiently, leading to a pig iron sale in March 2025 quarter. The company expects to achieve more than 100% efficiency in FY2026.
• As a part of its growth plans, the company, as of FY’25, incurred a capex of ₹6,584 crores, representing 66% of its plant expenditure. It has capitalized ₹4,908 crores as on date. Its ongoing projects are progressing well and the company timely completion.
• It expects the majority of its carbon steel capex to be operational by FY’26. While its stainless steel and aluminum capex are targeted to be commissioned by FY’27. These investments are aligned with its broader strategy of integration, operational efficiency, and sustainability.
• During the quarter ended March 2025, the company reported revenue growth of 14.8% YoY to ₹4,139 crores. EBITDA margin improved to 12.4% from 12.2% same period last year, with EBITDA up by 16.6% to Rs. 515 crore.
• According to the management, the company continues to expand its share in value-added products, further highlighting its commitment to diversifying and fortifying its market position.

Shyam Metalics and Energy Limited: Shareholding Pattern

In the overall shareholding of Shyam Metalics and Energy, promoters have the highest shareholding at 74.59%.

Shyam Metalics and Energy Limited: Valuation

The company is a strong player in India’s steel and ferro alloys sector, with robust fundamentals, a diversified product portfolio, and ambitious expansion plans. Its recent developments, like new product launches and capacity additions position it for future growth.

Thus, it is expected that the stock may see a price target of ₹1,072 in 8 to 10 months’ time frame on a current P/BV of 2.47x and FY26 BVPS of ₹433.93.

Shyam Metalics and Energy Limited: Risk

• High Commodity Prices
• Economic slowdown

Conclusion

These two stocks, one from the banking sector and other from the metal sector can reach their target price in the coming 8 to 10 months. However, it is always better if you do your analysis before investing and set a stop-loss target. To keep track of your invested stocks, open a demat account with SMC Global Securities and invest on the go.

Reference:
https://www.smctradeonline.com/research/wise-money/241

Author: All Content is verified by SMC Global Securities.