Federal Bank Ltd. share price target

Bank's top-line performance was up as net interest income increased by 14% to Rs 1022 cr. compared to Rs. 899 cr. YoY & grew by 4% from Rs. 980 cr. QoQ. Other income of the bank grew by 12% to Rs. 323 cr. YoY with support of higher fee income growth of 33%. C/I ratio for the bank decreased by 268 bps YoY and 365 bps...

GNPA/NNPA ratios slipped to 3.1%/1.8 against 2.4%/1.3 YoY caused by flood in Kerala & corporate slippages. Loan book grew by 25% YoY with a whopping growth across Retail, SME and Corporate segments, while deposits grew by 21.5% YoY....

Business growth improves: Overall business grew 23.2% YoY to 2,19,123 crore as on 30 Sept'18 with advances and deposits growing 25.2% and 21.6%, respectively. On the deposits side, the current account and savings account (CASA) deposits grew 23.2% to 39,457 crore with the CASA ratio remaining stable at 33.4%. Advances grew the highest in last 5 quarters largely driven by 28.8% growth in wholesale loans and 20.0% growth in retail loans. Over FY18-20E, we expect advances and deposits to witness CAGR of 26.5% and 21.0% respectively, resulting in overall business growth of 23.5% to 3.11 lakh crore....

Federal Bank Ltd Q2FY19 results Comment NII grew to Rs. 1022.47 Cr in Q2FY19 compared to Rs. 980.06 Cr in Q1FY19. The NII had been increasing from Q1FY19 to Q2FY19.

ICICI Securities Ltd | Retail Equity Research Operating earnings increased 20% YoY to | 698 crore vs. estimate of | 664 crore. This was led by healthy traction in other income (core fee income grew 33% YoY) and lower operating expenses However, PAT was at | 266 crore (up by a muted 0.7% YoY) vs....

Maintain NEUTRAL with a TP of Rs 89 (1.3x Sept-20E ABV of Rs 68). Post the pleasant surprise in the previous qtr, FBs 2Q earnings were a mixed bag. The key positives were (1) Sustained growth momentum, (2) Strong fee growth +25% QoQ, (3) Stable CASA & margins and (4) Improvement in oplev: C-I ratio improved ~390bps QoQ. However, asset quality deterioration (GNPA +11%) and higher capital consumption (Tier I down ~120bps QoQ) and aggressive slippage guidance (Rs 14.5bn in FY19) were disappointing.

We believe that the Federal Bank is approaching the end of recognition of stressed loan cycle, which along with improving PCR clearly indicates a sharp moderation in credit cost from FY20E onwards. We believe that the Bank will continue to deliver further improvement in operational performance, going forward led by steadily improving loan book and asset-liability mix. Further, we do not anticipate the recent floods to impact its profitability in any significant way. Looking ahead, we expect strong traction in earnings to continue owing to robust growth in loan book, moderate credit cost and healthy margin. We continue to maintain our BUY recommendation...

Impact of Kerala floods weighs in the near term: Kerala floods have cost both humanity and economics. We believe banks and financial institutions may see the impact in the form of 1) rise in fresh slippages; 2) spike in involuntary credit costs (especially for SME/MSME/agri/ retail segments); and 3) weak credit offtake. Federal Bank has 32% of its advances and has...

Maintain NEUTRAL with a TP of Rs 103 (1.5x Mar-20E ABV of Rs 69). In the wake of catastrophic floods in Kerala, rumours have surfaced surrounding the ability of banks to function, loss of physical assets and data. Admirably, Federal Bank (FB) has been the first to come forth and address these issues. In the concall, FB quashed apprehensions regarding any operational challenges owing to the floods. However, we believe there could be persistent jolts as clarity emerges over the next few quarters around assets affected by the floods.

The Bank was incorporated on April 23, 1931 as the Travancore Federal Bank...