RBL Bank Ltd. share price target

We met MD & CEO R Subramaniakumar of RBL Bank (RBK), to understand the progress on the Emirates NBD (ENBD) deal and the growth outlook, particularly in view of the huge capital boost post-deal.

Our meeting with RBL Bank’s (RBL) MD&CEO further cements our positive stance on RBL. We believe the proposed USD 3bn capital infusion (link) from Emirates NBD (ENBD) catapults RBL several notches up in terms of net worth, CET1, technology offering, funding competitiveness and distribution, thereby securing huge growth runway.

In Q2FY26, interest earned declined 0.7% YoY owing to reduced income on investments (-1.2% YoY), interest on balance with the Reserve Bank of India and other inter-bank funds (-31.7% YoY). Interest expenses increased 2.1% YoY to Rs. 1,957cr. As a result, net interest income (NII) decreased 4.0% YoY to Rs. 1,551cr...

We are enthused with RBL Bank’s (RBL) proposed transaction with Emirates NBD (ENBD) as it brings strong parentage to RBL, opens huge secular growth runway and solves frequent capital needs (pro forma CET 1 >35%).

RBL Bank (RBK) reported 2QFY26 PAT of INR1.8b (5% miss), down 20% YoY, due to higher-than-expected provisions and lower other income.

Despite slower credit growth and sharper margin contraction, RBL reported a 27% PAT beat at Rs2bn and 0.6% RoA, mainly due to higher treasury gains and contained provisions (50bps in Q1/2% annualized, including 6bps contingent provisions on JLG MFI loans).

RBL Bank (RBL) reported a weak set of results with a sharp ~40bps QoQ dip in NIM, double-digit NII de-growth and unchanged slippages. Reported PAT of INR 2bn (RoA of 0.5%) was supported by massive treasury gains (INR 2.7bn or ~0.7% of assets), INR 2.3bn utilisation of buffer and 500bps QoQ dip in PCR.

RBL Bank (RBK) reported a 1QFY26 PAT of INR2b (42% beat, 46% YoY decline) amid lower-than-expected provisions.

We met RBL Bank MD and CEO R S Kumar to discuss the bank’s future outlook following a clean-up act in FY25, due to elevated stress in its unsecured portfolio.

PAT declined 80.5% YoY to Rs. 69cr, due to full provisioning on JLG (Joint Liability Group), higher credit cost, lower NII and increased operating expenses. across key business segments while maintaining its branch network and strengthening customer engagement. Continued focus on improving deposit granularity, expanding retail assets and optimising operational efficiency is expected to support balanced growth. While business fundamentals are improving, near-term margin pressures and a cautious approach in unsecured segments may limit the upside. However, strategic investments in digital initiatives and risk management are...

RBL Bank (RBK) reported 4QFY25 PAT of INR687m (81% YoY decline). NII declined 2.3% YoY to INR15.6b (in line) due to lower disbursals in the JLG business. NIMs remained broadly stable at 4.89% during the quarter.

RBL continued with its clean-up drive in Q4 as it fully provides for the MFI NPA portfolio leading to historically lower NNPA at 0.3%. However, the bank utilized its contingent provision buffer of Rs2.7bn which along with nearly flat margins and strong card fees helped manage profitability, albeit negligible at Rs0.7bn.

Provisions more than doubled in Q3 leading to PBT loss, this was on account of higher provisioning in the MFI portfolio

RBL Bank (RBK) reported a 3QFY25 PAT of INR326m (53% miss, 86% YoY decline) amid higher-than-expected provisions. The bank prudently made additional provisions of INR4.14b on its JLG loans to take PCR on this portfolio to 85%

RBL has initiated a clean-up act in 3Q amid rising delinquencies in the MFI portfolio due to imposition of MFIN guardrails, in addition to elevated, though moderating, stress in the card portfolio due to breakup from BAF, leading to higher provisions and thus PBT loss at Rs1.9bn.

The partnership with BFL has sourced 3.4m co-branded cards and these cards will continue to operate as usual, with cardholders retaining full benefits. Upon renewal, these cards will be reissued as RBK-branded credit cards.

RBL Bank (RBL) has snapped its long-standing co-branded credit card ties with Bajaj Finance (BFL). The parting of ways is due to significant change in product synergies over time. As of Q2FY25, BFL formed ~65% of the o/s cards and 50-55% of receivables.

The RBL-BFL card partnership, already on a planned scale-down path, has finally ended. The bank will manage the portfolio independently with a tail spend-based fees to be shared for some time with BFL.

RBL Bank (RBK) reported 2QFY25 PAT of INR2.2b (12% miss, down 24% YoY), dragged down by high provisions.