New Research Reports

Advances growth driven by secured loans; deposit growth was strong compared to system levels

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Mahindra & Mahindra Financial’s (MMFS) 4QFY25 PAT declined ~9% YoY to ~INR5.63b (in line), while FY25 PAT grew ~33% YoY to INR23.4b. NII in 4QFY25 stood at INR19.3b (in line) and grew ~6% YoY.

AU Small Finance Bank (AUBANK) posted a 4QFY25 PAT of INR5.04b (7% beat; -5% QoQ), amid better other income partly offset by higher provisions. NII grew 3.5% QoQ to INR20.9b (in line), while NIM contracted 6bp QoQ to 5.8%, primarily on account of a change in asset mix.

FY25 has been weak for the bank marked by elevated stress in unsecured retail loans resulting in a sharp increase in credit costs, higher interest rates and tight liquidity. Q4 earnings missed estimates led by accelerated provisioning on account of the stress in unsecured loans, yet PCR improved.

We recommend a BUY on the stock with a target price of Rs 49/share, implying an upside of 11% from the CMP.

We maintain our BUY recommendation on the stock.

We maintain our BUY recommendation on the stock.

CD ratio continued to moderate with slowdown in credit growth, while deposit growth higher than system growth

ICICIB saw yet another good quarter with core PAT beating PLe by 3.7% due to better asset quality; core PPoP was in-line at Rs166bn. While loan growth was softer at 2.1% QoQ due to pricing pressure and slower system growth, reported NIM adjusted for tax refund of 2bps improved by 14bps QoQ to 4.4% despite tight liquidity. Due to RBI accommodative stance, overall repo rate cut is likely to be between 75-100bps compared to our estimates of 50bps. We revise our repo rate cut assumption to 75bps and trim NIM for FY26/27E by 9/7bps;...