Federal Bank Shares Gets Nirmal Bang's 'Buy' Upgrade; Target Price Hiked — Here's Why

Post the fund raise, the brokerage builds in a pick up in loan growth from 8.9%/11.5% for FY26E/FY27E earlier to 10%/12% respectively. Nirmal Bang's loan growth estimate for FY28E remains unchanged at 14.2%..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..Nirmal Bang Report.Federal Bank Ltd. has issued 273 million warrants at a price of Rs 227, aggregating Rs 62 billion to Asia II Topco XIII Pte. Ltd, a Blackstone associate. These warrants are convertible into equity shares within a period of 18 months from the date of allotment. Post exercise of these warrants into equity shares, these will represent 9.99% stake in the bank. We have estimated the warrants to be converted into equity shares by FY26 end, which will result in 11.1% equity dilution and lead to an improvement of 280 bps in the CAR to 18.5% (from 15.7% in September 2025)..We turn positive on Federal Bank due to the following reasons:Loan growth to pick up,Strong patronage of depositors,NIM to remain stable at 3.1%,Visibly cleaner corporate book and low proportion of unsecured loans,RoA drivers..Click on the attachment to read the full report:.Kotak Mahindra Bank Q2 Review: Brokerages Signal Mixed Performance; Strong Loan Growth, NIM Pressure.DISCLAIMERThis 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.

Federal Bank Shares Gets Nirmal Bang's 'Buy' Upgrade; Target Price Hiked — Here's Why

Nirmal Bang upgrades Federal Bank's stock from Hold to a ‘Buy’, check new target price.

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