RBL Bank Share Price Jumps 4.3%; Bullish Breakout with Immediate Resistance at Rs 245
RBL Bank share price jumped 4.28 percent and the stock is currently looking bullish on technical charts. If overall markets remain positive, we can expect further momentum in RBL Bank. The banking counter is currently trading at its 6-month highs and has offered 39 percent return to investors during the past six months. Financial results reveal a drag on profitability due to provisioning, but improving asset quality and valuations below book value present an attractive, if high-risk, investment opportunity. Technical analysts are bullish in the near term, while fundamental experts expect improvements in credit cost and loan book expansion to drive medium-term gains.
RBL Bank: On the Road to Redemption with Strategic Momentum
RBL Bank's recent performance in equity markets has reignited investor interest. As of June 18, 2025, the stock surged 4.48% to Rs 228.43, continuing a three-month rally of over 40.76%. However, this comes on the heels of a challenging year in which the stock dropped 12.08%, reflecting lingering skepticism from the street. With a market capitalization near Rs 13,885 crore, RBL Bank has become a focal point for technical and value-based investors alike.
Technical Setup: Bullish Indicators Reinforce Buy Calls
Key Support Zone: Rs 215–217 | Entry Range: Rs 228–230 | Stop-Loss: Rs 212
Analysts across brokerage houses converge on a similar message: RBL Bank has exited correction territory and resumed its uptrend. The breakout move on June 18 is considered confirmation of renewed bullish sentiment. Technical indicators such as weekly/monthly MACD and Bollinger Bands affirm the trend, although momentum oscillators like KST signal a cautious optimism.
Short-Term Targets: Rs 235 to Rs 250, with staged exits suggested at Rs 236, Rs 240, and Rs 245.
Q4 FY25 Financials: Weak Bottom Line Despite Income Growth
Quarterly Net Profit: Rs 69 crore (down 81% YoY)
While the bank’s interest income climbed to Rs 3,476 crore (from Rs 3,339 crore YoY), and total income reached Rs 4,476 crore, the quarterly bottom line disappointed. The steep fall in profit was primarily driven by provisions and contingencies rising to Rs 785 crore, almost doubling from the prior year. However, asset quality showed improvement:
- Gross NPA: 2.6% (vs. 2.65% YoY)
- Net NPA: 0.29% (vs. 0.74% YoY)
For FY25 overall, net profit dropped to Rs 695 crore, from Rs 1,168 crore in FY24.
Asset Quality and Capital: Conservative, but Solid
CET1 Ratio: 14% | No Capital Raise Planned for FY26
Despite earnings compression, RBL Bank has safeguarded its capital buffer. The improved NPA ratios and capital adequacy metrics signal prudent risk management. Management has indicated that no fresh equity capital infusion is expected in FY26, relying on internal accruals and balance sheet discipline.
Leadership Reshuffle and Investor Communication
Key Retail Leadership Appointments in June 2025
The bank’s internal overhaul is also visible at the top. New senior appointments in retail banking suggest a renewed focus on franchise building and operational agility. RBL has conducted multiple investor and analyst engagements, a clear step toward restoring market confidence.
Brokerage Views: Divergent Near-Term Targets but Positive Bias
| Research House | Date | Recommendation | Target Price | Rationale |
|---|---|---|---|---|
| The Hindu Business Line | June 19, 2025 | Buy / Accumulate | Rs 250 | Strong uptrend, technical support at Rs 215, staged stop-loss strategy |
| INDmoney (Taparia) | June 17, 2025 | Buy | Rs 235 | 20 DEMA support, uptrend intact |
| Investec | May 26, 2025 | Buy | Rs 230 | Falling credit costs, loan growth, stable CET1, no capital raise |
| S&P Global (Consensus) | June 2025 | Hold/Buy | Rs 210.63 | Mixed outlook due to earnings volatility, but potential upside |
Valuation Snapshot: Still Undervalued Relative to Peers
- Price-to-Earnings Ratio: 19.36 (in line with peers)
- Price-to-Book Ratio: 0.93 (below book, undervalued)
- Intrinsic Value Estimate: Rs 291.80 (as of June 16, 2025)
Despite trading at a discount to its estimated fair value, RBL Bank’s dividend yield remains modest at 0.63%. Valuation remains the key upside driver, pending clarity on earnings normalization.
Performance vs Peers: Value with Caution
| Bank | 1-Year Return | P/E | P/B | Gross NPA | Net NPA |
|---|---|---|---|---|---|
| RBL Bank | -13.2% | 18.44 | 0.84 | 2.6% | 0.29% |
| HDFC Bank | 22.5% | Higher | Higher | Lower | Lower |
| ICICI Bank | 26.6% | Higher | Higher | Lower | Lower |
RBL continues to trail sector leaders in returns and scale, but for value investors, the low P/B ratio and improving asset quality are compelling hooks.
Investment Takeaway: Time to Accumulate?
RBL Bank presents a compelling turnaround case for risk-tolerant investors. Analysts and technical experts point to Rs 235–250 targets in the near term, with a stop-loss framework around Rs 212. From a fundamental standpoint, recovering asset quality, no capital dilution, and high provisioning coverage are positives. However, persistent margin pressure and management turnover risk remain overhangs.
Long Term Investing: Investors seeking exposure to a second-tier private bank turnaround could accumulate on dips, with a view to gradual re-rating. Quarterly monitoring and clarity on the credit cost trajectory will be critical to reassessing this bet in the second half of FY26.
