The Gulf countries are rapidly changing after the coronavirus pandemic. It has many notable impacts on the banking sectors especially in the Islamic retail banks. This study has focused on the valuation of the Islamic retail banks in Bahrain. There are only six Islamic retail banks that follow Shariah rules and regulations. This paper consists of the monthly data from July 2016 to June 2021. The CAPM model has been applied for the valuation of Islamic retail banks and the multiple regression method run for the impact of Islamic retail banks on the Bahrain Bank index during the period. The outcomes of CAPM have identified overvalued BISB, Baraka, Salam, KHCB, and ITHMR except for the KFH, which is undervalued. The significant results have found the relationship between the six retail Islamic banks and the Bahrain banks index in Bahrain. The interpretation of t-statistics shows a substantial difference between the CAPM and actual returns of Islamic retail banks in Bahrain. The banking system will be a modern economic world which helps to create the nation. The nation will develop if society will be aware about financial literacy and analytics. This paper will help the industrialist, practitioner, brokers, promoters, and investors.