Bank of Maharashtra is a government-owned bank (Govt. holds 79.60% as of Sept 2025) offering all kinds of banking services—corporate, retail, treasury, etc. The Bank of Maharashtra’s Q2 results reflect a mixed financial performance, which explains why the stock fell nearly 5%, despite a rise in net interest income.
Key Highlights (July–Sept Quarter):
Positive Points:
- Net profit –The bank made a net profit of ₹1,633 crore, which is 23.2% more than the same time last year.
-
Net Interest Income (NII) — The money it makes mainly from lending went up 15.7% to ₹3,248 crore.
- Total income (money earned from various banking activities) increased by 17.1% to ₹7,974 crore.
- Profit before tax (PBT) grew even more up 31.78% to ₹1,818 crore.
- Net Interest Margin (NIM), a measure of how efficiently the bank earns from lending, was 3.85%, which is healthy.
- Operating profit (profit before provisions and taxes) grew by nearly 17% to ₹2,574 crore.
The bank reported strong deposit growth with
– Total deposits rising by 12.1% to ₹3.09 lakh crore.
– CASA (Current Account and Savings Account) deposits up by 14.55% which are low-cost sources of funds.
– CASA ratio: Improved to 50.35%, a positive indicator for profitability as it reflects a higher share of inexpensive funds in the bank’s deposit base.
– Loans (advances): grew by 16.87% to ₹2.54 lakh crore, signaling healthy credit demand.
– Global business: grew by 14.2% which includes both deposits and advances.
Why the stock fell?
Even though the bank showed growth in income, the underlying asset quality (high slippages) is a concern. Slippages remained above ₹700 crore this quarter. High slippages signal asset quality stress. This means more loans are going bad, and the bank will have to set aside more provisions, reducing profits. Investors usually see rising slippages as a warning sign for future performance.
Despite good results, the stock price fell to ₹55.18. Some possible reasons may be:
-
Investors may have already priced in the good results earlier.
-
Some investors might be taking gains off the table.
-
The overall market or banking sector might be weak that day.
-
The stock might be seen as fully valued or expensive after the recent rally.
Overall the bank is growing well and making more profit. Even the results indicates stronger core banking operations, likely from more lending or better interest margins but investors are being cautious because some of its loans are turning bad (NPAs). Slippages are still high — meaning more loans are becoming risky. They’re waiting to see if the bank can maintain margins and keep asset quality stable going forward.
