Bank of Baroda shares are likely to remain in focus on Friday after the state-run lender agreed to a $600 million (around Rs 5,700 crore) out-of-court settlement with the joint administrators of NMC Health PLC, NMC Healthcare Ltd and NMC Holding Ltd, bringing a long-running legal dispute to an end.

The stock had declined 4.3 percent in the previous session to close at Rs 259.85 after the announcement. It is down 13.6 percent so far this year, compared with a 7.5 percent decline in the Nifty 50. The bank has a market capitalisation of about Rs 1.34 lakh crore.

Nomura flags likely Q1 earnings impact

Following the development, Nomura maintained its 'Neutral' rating on Bank of Baroda stock with a target price of Rs 300, implying an upside of over 15 percent. The brokerage said that the agreed settlement amount of $600 million is equivalent to around 4 percent of Bank of Baroda's net worth.

Nomura said that while the settlement removes the uncertainty associated with prolonged litigation and has been reached without any admission of wrongdoing, it is likely to hit the bank's April-June quarter earnings.

According to the brokerage, the provision for the settlement was unlikely to have been made earlier and is therefore expected to be recognised in the first quarter of FY27, weighing on reported profitability.

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What is the NMC settlement?

In an exchange filing on Thursday, Bank of Baroda said it had entered into an out-of-court settlement with the joint administrators of NMC Health PLC, NMC Healthcare Ltd and NMC Holding Ltd. The settlement is in relation to proceedings before the Abu Dhabi Global Market Court of First Instance and the High Court of Justice of England & Wales.

The lender said all claims and causes of action between the parties have been resolved without any admission of liability or wrongdoing. It added that its liability under the proceedings is limited to the agreed settlement amount.

Bank of Baroda further said the settlement amount has been paid by its Abu Dhabi branch. Pursuant to the agreement, the proceedings before the Abu Dhabi court have been discontinued, while those before the English court are in the process of being discontinued.

The bank said the settlement was aimed at bringing the disputes to a close, avoiding prolonged litigation, uncertainty and the associated legal costs.

Strong Q4 performance

The settlement comes after Bank of Baroda reported a better-than-expected performance for the January-March quarter, supported by healthy business growth and improving asset quality. The lender posted a net profit of Rs 5,615.7 crore for Q4 FY26 , up 11.3 percent from Rs 5,048 crore a year earlier. Net interest income (NII) rose 8.7 percent year-on-year to Rs 12,493.7 crore from Rs 11,494 crore, exceeding Street expectations.

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