Stay 'Neutral' On IDFC First Bank Shares Retains Motilal Oswal — Here's Why

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Motilal Oswal Report

IDFC First Bank Ltd. has delivered remarkable progress in deposit retailization while maintaining robust loan growth and steadily reducing balance sheet risks.

With net interest margin guidance of ~5.8% in Q4 FY26, continued deposit momentum, and strong capital buffers (CRAR 15% before capital raise; 17.6% after the raise), the bank is positioned to deliver improved profitability metrics in the coming years, though elevated cost ratios and the provisioning drag from MFI remain near-term constraints on earnings.

We thus estimate pre-provision operating profit/PAT CAGR of ~33%/71% over FY26-28E, translating into RoA/RoE of 1%/9.3% by FY27E.

We maintain our Neutral rating with a target price of Rs 80.

Execution on cost/income reduction, sustained asset quality improvement, reduction in credit costs and steady NIMs are key upside catalysts.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.