Shares of Bank of Maharashtra surged 4.36% to ₹78.83 on the NSE as of 9:28 AM IST on Tuesday, touching a fresh 52-week high of ₹79.20 intraday, after the state-run lender reported a strong set of Q4 FY26 results and shared a detailed, confident FY27 guidance on its earnings call on Monday. Market capitalisation stood at ₹60,625 crore with the stock trading at a PE of 9.35 and a dividend yield of 1.75%. The year range of ₹47.51 to ₹79.20 underscores how significantly the stock has re-rated over the past twelve months.
Q4 FY26 Results — The Numbers That Drove the Move
Bank of Maharashtra reported a net profit of ₹2,014 crore for Q4 FY26, up 15% year-on-year, delivering consistent double-digit profit growth that the market has come to expect from the lender. Net Interest Income — the core income measure for banks — rose 19% year-on-year to ₹3,702.5 crore, reflecting strong loan growth translating into healthy interest spreads.
Asset quality continued its improvement trajectory. Gross NPA declined to 1.45% and net NPA improved to 0.13% in the quarter — numbers that position Bank of Maharashtra among the best in class for asset quality across public sector banks. A net NPA of 0.13% is exceptional and reflects both the bank’s credit underwriting discipline and its aggressive provisioning approach over recent years.
The board recommended a final dividend of ₹1.2 per equity share for FY26, subject to shareholder approval at the AGM. Combined with the interim dividend of ₹1 per share declared in January 2026, the total dividend payout for FY26 stands at ₹2.2 per share.
FY27 Guidance — Ambitious Targets With Credit Quality as the Non-Negotiable
The management’s FY27 guidance, shared during the Monday earnings call, is comprehensive and ambitious across every key metric while consistently reiterating that growth will not come at the cost of credit quality.
On growth, total business growth is guided at 16% to 17%, with advances growth at 18% and deposits growth between 14% and 15%. RAM — Retail, Agriculture and MSME — growth is guided at 18%, with the RAM-to-corporate mix maintained at 60:40 with a plus or minus 2% variation, signalling continued preference for the more granular and diversified RAM book over concentrated corporate exposures.
On profitability, NII growth is targeted at 15% year-on-year. Net Interest Margins are guided at 3.75% — a level that reflects management’s confidence in maintaining pricing discipline even as deposit cost competition intensifies across the banking system. Non-interest income growth is targeted at 10%, and the cost-to-income ratio is guided to remain below 40% — a efficiency metric that Bank of Maharashtra has consistently delivered on and which compares favourably to most PSU bank peers.
Return on Assets is guided at 1.8% and Return on Equity at 20% or higher — both metrics that, if achieved, would place Bank of Maharashtra among the most profitable public sector banks in India in FY27.
CASA growth is targeted at approximately 5%, with liability mobilisation specifically called out as a key focus area for the year — an acknowledgement that the deposit franchise needs active investment even as loan growth momentum continues.
Asset Quality Guidance — Best in Class Targets
On asset quality the FY27 guidance is equally disciplined. Gross NPA is targeted to remain within 2%, net NPA within 0.2%, slippages below 1%, credit cost around 1% and the provision coverage ratio at 98%. The Capital to Risk-weighted Assets Ratio is guided at 18% — well above regulatory minimums and providing comfortable headroom for the planned 18% advances growth.
Management specifically noted that the MSME segment’s recent slowdown was a quality-led rebalancing exercise rather than a demand problem — a reassurance that the RAM growth target of 18% is achievable without compromising the underwriting standards that have delivered the lender’s industry-leading asset quality ratios. The Maharashtra farm loan waiver scheme was cited as a potential positive for agriculture NPA resolution.
Valuation and What the Street Sees
At ₹78.83 with a PE of 9.35, Bank of Maharashtra trades at a modest valuation relative to its growth and profitability guidance — a discount that reflects the PSU bank category’s historical re-rating challenges rather than any specific concern about the lender’s fundamentals. The 52-week range from ₹47.51 to Tuesday’s high of ₹79.20 reflects a near doubling from the lower end, and Tuesday morning’s fresh 52-week high suggests the market is acknowledging the quality of both the Q4 print and the FY27 guidance in real time.
A combination of 15% NII growth, 20%+ ROE, sub-2% GNPA and 18% advances growth — if delivered — would make a compelling case for further re-rating from current levels.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Readers are advised to consult a SEBI-registered financial advisor before making investment decisions. Stock prices are indicative and subject to change.