IDFC First Bank Ltd. share price target

IDFC First Bank, founded by the merger of erstwhile IDFC Bank and erstwhile Capital First on December 18, 2018. At present, the bank's total number of branches stands at 599, with a total funded assets to the tune of around ~Rs.1,17,270cr. Net Interest Income (NII) reported a growth of 27.4% on a YoY basis, and reported Net Interest Margin (NIM) improved to 5.76% in Q2FY22, compared to 5.51% in Q1FY22. Bank is shifting its business from wholesale and infrastructure...

Cautious on high valuation and asset quality woes IDFC First Bank, founded by the merger of erstwhile IDFC Bank and erstwhile Capital First on December 18, 2018. At present, the bank's total number of branches stands at 601, with a total funded assets to the tune of around ~Rs.1,13,794cr. Net Interest Income (NII) reported a growth of 25.3% on a YoY basis, and reported Net Interest Margin (NIM) improved to 5.51% in Q1FY22, compared to 5.09% in Q4FY20....

What should investors do? The IDFC First stock has given ~30% return in the past three years while the stock price has jumped ~2x in the past one year. Rise in stress remains a near term overhang but a gradual improvement in margin and operational...

IDFCFB reported a loss of Rs6.3bn (PLe: PAT of Rs1.2bn) on back of a much sharper provision Rs18.8bn, rise of 3x QoQ. Operating performance was relatively decent on (i) SA rate cut in May'21 & improving retail mix has helped on strong NII (ii) relatively better opex and (iii) treasury leading to PPOP growth of 12% YoY/55% QoQ. Slippages of Rs28.8bn (annualized 11.5% of...

Cautious on high valuation and asset quality woes IDFC First Bank, founded by the merger of erstwhile IDFC Bank and erstwhile Capital First on December 18, 2018. At present, the bank's total number of branches stands at 596, with a total funded assets to the tune of around ~Rs.1,17,127cr. Net Interest Income (NII) reported a growth of 15.3% on a YoY basis, and reported Net Interest Margin (NIM) improved to 5.09% in Q4FY21, compared to 5.04% in Q3FY20....

Net interest income (NIM) was up 15.3% YoY to | 1960 crore despite | 55 crore worth interest on interest reversals. Net interest margins (NIM) were up 4 bps QoQ to 5.09%. The bank has reduced savings interest rate to 4% for deposits below | 1 lakh and peak rates of 5%, which should keep funding cost benign and, thus, aid margins. Other income was up 74% YoY mainly due to trading gains. Operating expense were up 11% QoQ to | 2156 crore. This rise can be attributed to increased business activity. Cost-to-income ratio (calculated) was up from 75.1% to 76.9% QoQ. Provisions during the...

impact of second COVID wave needs close monitoring as slippages have been high. High provisions and utilization of COVID provisions of Rs21.0bn have improved coverage ratio, although buffer is now low at 37bps of loans (created in Q4FY21). Delta from past cut in SA rates and improving mix of retail both on liabilities & assets has led to NIM moving to 5.0%, while recent SA rate cuts should help lower funding cost should help improving earnings profile. We value the bank at 1.3x (from 1.0x) FY23E ABV. Capital raising &...

IDFC First Bank, founded by the merger of erstwhile IDFC Bank and erstwhile Capital First on December 18, 2018. At present, the bank's total number of branches stands at 576, with a total funded assets to the tune of around ~Rs.1,10,469cr. We roll forward our valuation to FY23 and value the bank at 2.3x...

IDFCFB's earnings performance of Rs1.30bn (PLe: Rs1.52bn) was a miss on high provisioning this quarter mainly on back of pro-forma NPAs and higher opex which was offset by higher other income. Pro-forma NPAs came in high at 4.2% and in retail at 3.9% which were on higher side, although bank holds a Rs21.6bn of COVID provision and should see gradual reduction in NPAs on recovery/write-off. Bank's retail drive continues to move ahead with strong CASA growth of 8% QQ and CASA + Retail TDs up 10% QoQ replacing bulk deposits, while corporate book has continued to de-grow by 17% YoY and...

NII was up 13.7% YoY, 5.1% QoQ to | 1744 crore. NIMs expanded QoQ by 8 bps and 79 bps YoY to 4.65% despite interest reversals due to NPAs, supported by sharp rise in CASA deposits. Other income for the quarter jumped 31.1% YoY | 759 crore. Fee income increased 33% YoY to | 582 crore. Provisions for the quarter were at | 482 crore, up 123% QoQ owing...