Bank of India plunges

Bank of India declined 5.38% to Rs 273.25 at 14:17 IST on BSE, after providing for Rs 108.60 crore on account of exposure to troubled US investment bank Lehman Brothers, in Q2 September 2008.

The bank announced the Q2 results during trading hours today, 22 October 2008.

Meanwhile, the BSE Sensex was down 383.62 points, or 3.59%, to 10,299.77.

On BSE, 14.78 lakh shares were traded in the counter. The stock had an average daily volume of 8.30 lakh shares in the past one quarter.

The stock hit a high of Rs 238 and a low of Rs 221.05 so far during the day. The stock has a 52-week high of Rs 466 on 17 January 2008 and a 52-week low of Rs 189 on 1 July 2008.

The stock declined 3.10% to Rs 288.80 on 21 October 207, ahead of the results.

The mid-cap bank-stock had outperformed the market over the past one month till 21 October 2008, gaining 1.87% as compared to the Sensex's decline of 23.92%. It had also outperformed the market in the past one quarter, rising 6% as compared to the Sensex's decline of 22.86%.

The bank's current equity is Rs 525.17 crore. Face value per share is Rs 10.

The current price of Rs 78 discounts the company's Q1 September 2008 annualized EPS of Rs 9.08, by a PE multiple of 25.09.

The US investment bank Lehman Brothers, last month, filed for bankruptcy protection in the United States. Despite the large provision, Bank of India's net profit surged 79.38% to Rs 762.86 crore on 31.64% increase in total income to Rs 4612.27 crore in Q2 September 2008 over Q2 September 2007.

Bank of India's capital adequacy ratio, or the ratio of capital to loan assets, was 12.45% as of 30 September 2008, more than the minimum 9% required by the Reserve Bank of India.

The bank's principal activities are the provision of banking services. The services of the group include acceptance of deposits, provision of loans, financing rehabilitation, treasury and investment management services to consumers and industries.

The Government of India holds 64.47% stake in the bank (as on 30 September 2008).