The Central Bank of India Share Report Card?

The Central Bank of India Share Report Card?

Central Bank of India has delivered weak long-term stock returns since its 2007 IPO but has shown a sharp business and profitability turnaround in the last 3–4 years, which has improved sentiment and recent price performance. For an in-depth article, it helps to split the history into IPO/listing phase, long period of stress and losses, and the ongoing recovery cycle.​

IPO and early listing phase (2007–2010)

• The bank came to the market with a book-built IPO in July 2007 at a final issue price of about ₹102 per share and listed on both NSE and BSE in August 2007.​

• Listing was at a premium (opening around ₹130–132 and closing near ₹115), but the 2008 global financial crisis and the general underperformance of PSU banks soon pulled the stock down from its listing highs.​

Lost decade and value erosion

• On a 10‑year basis, the stock price CAGR is negative (around −6%), which means that an investor holding from around 2014–15 would have seen capital erosion or very poor wealth creation compared to private banks and the Nifty Bank index.​

• Even the 3‑year and 1‑year CAGRs have been volatile; data shows 3‑year CAGR in the mid‑teens but a steep negative near −30% over one recent 1‑year period, reflecting big up‑moves followed by corrections as sentiment swings on PSU bank themes.​

Reasons for long underperformance

• Historically, Central Bank of India struggled with very high stressed assets: gross NPAs were in double digits for many years, which suppressed profitability and kept return ratios like ROA and ROE near zero or negative.​

• Because of weak balance-sheet quality, the bank’s ROE over 10 years is reported around negative low single digits, improving only in the last 3–5 years, so the market assigned it a low valuation multiple and the share underperformed broader indices.​

Financial turnaround in recent years

• Over the last few financial years, the bank has moved from heavy losses to consistent profits; net profit has grown strongly, with some analyses citing a long‑term net profit CAGR above 40% from the trough years, as NPAs reduced and credit growth returned.​

• Key profitability metrics have improved: ROA has risen from negative in FY21 to about 0.41% in FY23, ~0.60% in FY24 and roughly 0.8–0.82% in FY25, while ROE has moved into low double digits (around 11–12%), indicating a much healthier franchise than before.​

Asset quality and growth metrics

• Gross NPA ratio has fallen sharply and now stands close to 3% with net NPA below 1%, a major improvement from earlier double‑digit levels, signalling cleaner books and better credit underwriting.​

• Advances are growing in mid‑teens (around 16% year‑on‑year) with three‑year advance growth close to 19%, and the bank maintains a strong CASA ratio near 49%, helping keep its cost of funds under control.​

Recent stock behaviour

• The current market price is in the high‑30s to around ₹40 per share with a 52‑week range roughly between ₹33 and ₹62, showing that the stock has already re‑rated from earlier lows but also faced a sizeable correction from recent peaks.​

• Short‑term data indicates that the stock has delivered negative returns over the latest one‑year window (around −30% range) after a sharp prior rally, which is typical of PSU bank cycles where valuations overshoot and then cool off.​

Dividends and shareholder rewards

• After a long phase of stress when payouts were limited, Central Bank of India has resumed dividends and is now described by brokers as having a “consistent” dividend track record in the recent period, though yields remain modest compared to some other PSU banks.​

• For a long-term investor who bought near IPO levels, total shareholder return (price plus dividends) still lags, but those entering during the stressed, low‑valuation phase of the last few years have seen much better absolute gains despite recent volatility.​

How to position this in your article

• Structurally, you can divide your Hindi article into: (1) Bank ka parichay aur IPO history, (2) NPA crisis aur “lost decade”, (3) turnaround story – NPA mein girawat, ROA/ROE improvement, (4) share price CAGR analysis with charts, and (5) risks and future outlook for PSU banks. Base each section on the long-term CAGR, ROA/ROE, gross NPA and price‑chart trends above.​

• For visuals, use a 2007–2025 price chart, a table of ROA/ROE by year, and a small timeline of key events (IPO, peak NPAs, turnaround, latest FY25 numbers) to clearly show how the bank moved from a weak PSU laggard to a cleaner, but still cyclical, turnaround story.