PSU bank index jumps 3% as PNB posts strong September profit

Punjab National Bank disclosed a September quarter profit of ₹5,500 crore, a 13% year-on-year increase that exceeded forecasts, prompting an 8% surge in its share price. The rally lifted the Nifty PSU Bank index by roughly 3% and saw gains of 2%-4% in peers such as Canara Bank, Punjab & Sindh Bank, Union Bank of India, Bank of India, Indian Bank and State Bank of India. Analysts attributed the performance to higher net interest income, improved net interest margins and lower provisions despite rising operating costs.

They also raised earnings estimates for FY27 and FY28, citing margin upside and modest treasury gains. Canara Bank reported a solid quarter with a 13.3% rise in core operating profit and healthy loan growth, leading analysts to lift its target price. Indian Bank posted an in-line result, noting a modest net interest margin improvement and maintaining its credit-growth outlook, while also increasing provisions for expected credit loss transition.