The shares of this leading bank tumbled over 8 percent on Monday as its senior executives resigned from the management, citing allegations of fraud. In this article, we will discuss more about this in detail.
With a market capitalization of Rs 7,408 crores, the shares of Karnataka Bank Ltd are currently trading at Rs 196 per share, down by 25 percent from its 52-week high of Rs 245 per share. Over the past five years, the stock has delivered a return of 366 percent.
On June 29th, the board of directors of Karnataka Bank accepted the resignation of Managing Director and CEO, Mr. Srikrishnan Hari Hara Sarma, and its Executive Director, Mr. Sekhar Rao, citing personal reasons. This comes nearly two months after the bank’s auditors pointed out that some expenses were made without board approval and went beyond what was allowed.
Financial Highlights
The company reported a revenue of Rs 9,014 crores in FY25, up by 8.61 percent from its FY24 revenue of Rs 8,299 crores. However, the company reported a net profit decline of 2.60 percent to Rs 1,273 crore in FY25 from Rs 1,307 crores in FY24.
The stock delivered an ROE and ROCE of 11.10 percent and 6.33 percent, respectively, and is currently trading at a P/E of 5.87x as compared to its industry average of 13.56x.
Karnataka Bank Limited is a private sector bank tailored to different financial needs, including corporate banking, retail banking, transactions in treasury operations, and more.
The bank supports customers in borrowing, offering loans to individuals, Medium and Small enterprises (MSMEs), and agriculture, with products like KBL Micro Mitra and KBL Mahila Udyog. The treasuring section of Karnataka Bank is responsible for investments and processes foreign exchange (post transaction) and statutory reserves.
The bank also offers supporting financial services such as online trading, on-deposit, locker allotments, and bill payments. Customers can access these and other services in physical branches or digitally..
Written by Satyajeet Mukherjee
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