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Federal Bank Q3 Results Review - Stellar Quarter; RoA Expansion On Track: Axis Securities

Federal Bank witnessed an impressive margin expansion of 22/19 bps YoY/QoQ to 3.49% (multi-quarter high).

<div class="paragraphs"><p>Close view of Indian bank notes, rupee arranged for photograph. (Photo: Vijay Sartape/ BQ Prime)</p></div>
Close view of Indian bank notes, rupee arranged for photograph. (Photo: Vijay Sartape/ BQ Prime)

BQ Prime’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 BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. 

Axis Securities Report

Federal bank Ltd. reported strong advances growth of 19/4% YoY/QoQ, driven by continued growth in the auto (up 27/6% YoY/QoQ), commercial vehicle (up 65/12% YoY/QoQ) and corporate book (up 19/6% YoY/QoQ).

Net interest income grew by 27/11% YoY/QoQ. Federal Bank witnessed an impressive margin expansion of 22/19 bps YoY/QoQ to 3.49% (multi-quarter high).

Core fee income continues to remain robust growing at 32% YoY aiding non-interest income growth of 10% YoY. Opex ratios remain stable at sub-50% driving pre-provision operating profit growth of 39/5% YoY/QoQ. 

Provisions remained benign with credit costs of 47 bps during the quarter, driving profitability for the bank. Profit after tax grew by 54/14% YoY/QoQ.

Federal Bank's asset quality improved marginally aided by strong recoveries even as slippages from the restructured pool kept retail slippages marginally elevated.

Click on the attachment to read the full report:

Axis Securities Federal_Bank-Q3FY23-ResultUpdate.pdf

More Research Reports On Federal Bank's Q3 FY23 Results Reviews

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