Bandhan Bank Ltd. share price target

Net advances were at Rs. 131,990cr, a 9.0% YoY growth, supported by increase in housing, retail and wholesale banking advances. GNPA and NNPA ratios deteriorated to 4.7% and 1.3% in Q4FY25 from 3.8% and...

During Q4FY25, the Net Interest Income stood at INR 27,559 Mn., down 3.6% YoY (-2.1% QoQ), below our estimates by 3.7% driven by higher slippages, and lower interest income led by increasing share of secured loans (now stands at ~50% of the book). Core NIMs stood at 6.7%, contracting by 90 bps YoY (-20 bps QoQ).

We revise our rating from BUY to HOLD, as we see limited upside from the CMP

Bandhan Bank (BANDHAN) reported 4QFY25 PAT of INR3.2b (up 480% YoY), 29% below our estimate due to lower other income and higher provisions.

Q4 was better than expected for Bandhan Bank, given the challenges the MFI segment was faced with. Though slippages were higher than in the prior quarter in the overall book incl. the EEB book, the decrease in the SMA book was positive, indicating lower incremental stress build-up.

Net Interest Income (NII) for the quarter stood at INR 28,303 Mn, reflecting a 12.1% YoY growth but a 4.0% QoQ decline. Core NIMs stood at 7.4%, improving by 20 bps YoY but contracting 20 bps QoQ. The NII missed our expectations primarily due to lower yields.

We maintain our BUY recommendation on the stock, given the upside is over 10%.

PPOP aided by one-offs in other income, payouts under CGFMU and Assam Microfinance relief scheme

Net Interest Income (NII) for Q2FY25 stood at INR 29,483 Mn, a growth of 20.7% YoY (-1.9% QoQ). The yields on advances improved by 40 bps YoY (-20 bps QoQ) at 13.7%.

We revise our rating BUY from HOLD earlier.

Bandhan Bank reported a 6% PAT beat at Rs9.4bn and RoA of 2.1%, mainly led by higher other income and lower than expected provisions – better than some peers that posted sharp earning downgrades.

Net Interest Income (NII) for Q1FY25 stood at INR 30,050 Mn, a growth of 20.7% YoY/ 4.8% QoQ. The NII was 2.2% better than our estimates, led by better-than-estimates.

We maintain our HOLD recommendation on the stock.

Bandhan Bank (BANDHAN) reported a healthy beat on PAT at INR10.6b (+47.5% YoY) fueled by controlled opex and provisions

Healthy business growth, improved asset quality and higher other income supported topline; increased provision dragged PAT

Bandhan Bank earnings were a miss on account of the technical write-off of loans; however, operating profits met our expectations. Net Interest Income (NII) for Q4FY24 stood at INR 28,663 Mn, a growth of 16.0% YoY/ 13.5% QoQ.

We maintain our HOLD recommendation on the stock.

We revise our rating from BUY to HOLD lowering the valuation multiple from 1.5x Sep'25E ABV to 1.1x Sep'25E ABV. We arrive at a target price of Rs 175/share, implying a downside of ~5% from the CMP.

Bandhan Bank Limited (BANDHAN)’s board has taken on record the letter submitted by Mr. Chandra Shekhar Ghosh, MD & CEO of Bandhan Bank, informing that he would retire from the services of the Bank as the MD & CEO upon completion of his current tenure on July 9, 2024.
Mr. CS Ghosh founded Bandhan Bank and has been associated with it for over 24 years. Post-retirement as CEO, Ghosh will take up a “strategic role” at the group holding company level (i.e., Bandhan Financial Holdings Ltd), advising the group’s business verticals.