Bank of Maharashtra:Buy/hold/sell?,future prospects and target price

Scripscan:Bank of Maharashtra
cmp:40
Code:532525

Story:Bank of Maharashtra provides banking services in India. The company offers various deposit products, such as savings deposits, current deposits, recurring deposits, fixed deposits, and floating rate and cumulative deposits. Its loan portfolio comprise personal loans, corporate loans, education loans, vehicle loans, consumer loans, housing finance, term loans, overdrafts, guarantees, and letters of credit, as well as loans for agriculturists, entrepreneurs, exporters, individuals, professionals, and corporate customers. In addition, it provides non-resident ordinary accounts, non resident external accounts, foreign currency non resident accounts, resident foreign currency accounts for non resident Indians. Further, the company offers credit cards, automated teller machines (ATM), bancassurance, utility bill payment, trust, and demat services, as well as Internet banking services; and distributes mutual funds. As of March 31, 2009, it operated a network of approximately 1,421 branches and 345 ATMs."Bank of Maharashtra (BOM) has high CASA share of 35.7% will help the bank in maintaining its low funding cost (5.9% in FY09). Strong business growth, high CASA ( 36%), decent asset quality, sustainable ROE of about 16%, strong network base, comfortable CAR of 12% with finance ministry promising to infuse the required capital in BOM, scope for growing advances due to low Credit deposit ratio and decent dividend yield are the other key positives for the bank.Buy with price target of Rs 49.