Federal Bank - Pursuing All-Round Growth: Motilal Oswal

Motilal Oswal Report

At its Analyst Day meet, Federal Bank Ltd. reiterated its focus on delivering a healthy performance across all key parameters.

The bank remains focused on delivering sustainable loan growth by leveraging data analytics, enhancing distribution through alternate channels and partnerships, and adopting the digital-first approach.

Federal Bank has been gaining market share in select segments like housing (5.5%), auto (2.75%) and personal loan (0.6%). It has also identified new verticals such as micro finance institution, credit card, commercial vehicle/construction equipment and business banking, which are witnessing robust growth.

The core focus remains on growing high yielding businesses, with the mix improving to 20.5% in Dec-22 from 17.4% in Dec-2019. Segments such as CV, CE and credit cards have been growing at a superior rate. This accelerated growth in high-margin businesses is likely to support net interest margin going ahead.

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