Neutral IDFC First Bank; target of Rs 85: Motilal Oswal
Motilal Oswal recommended Neutral rating on IDFC First Bank with a target price of Rs 85 in its research report dated January 21, 2024.22-01-2024
22-01-2024
Q3FY24 Quarterly Result Announced for IDFC First Bank Ltd.
IDFC First Bank announced Q3FY24 results: Profitability Net Profit grew 18% YoY from Rs 605 crore in Q3FY23 to Rs 716 crore in Q3FY24. Net Interest Income (NII) grew 30% YoY from Rs 3,285 crore in Q3FY23 to Rs 4,287 crore in Q3FY24. Net Interest Margin (gross of IBPC and sell-down) was 6.42% in Q3FY24 compared to 6.13% in Q3FY23 and 6.32% in Q2FY24. Fee and Other Income grew by 32% YoY from Rs 1,117 crore in Q3FY23 to Rs 1,469 crore in Q3FY24. Retail fees constitute 93% of the overall fees for the quarter Q3FY24. Core Operating income (NII plus Fees, excluding trading gains) grew 31% from Rs 4,402 crore in Q3FY23 to Rs 5,755 crore in Q3FY24. Operating Expenses grew by 33% YoY from Rs 3,177 crore in Q3FY23 to Rs 4,241 crore in Q3FY24. Core Operating Profit (pre-provision operating profit excluding trading gains) grew by 24% YoY from Rs 1,225 crore in Q3FY23 to Rs 1,515 crore for Q3FY24. Provisions increased 45% YoY from Rs 450 crore in Q3FY23 to Rs 655 crore in Q3FY24. The credit cost (quarterly annualized) as % of average funded assets for 9MFY24 was 1.26%. RoA (annualized) stood at 1.16% for 9MFY24. RoE (annualized) stood at 10.67% in 9MFY24. Deposits & Borrowings Customer Deposits increased by 42.8% YoY from Rs 1,23,578 crore as of December 31, 2022, to Rs 1,76,481 crore as of December 31, 2023. CASA Deposits grew by 28.6% YoY from Rs 66,498 crore as of December 31, 2022, to Rs 85,492 crore as of December 31, 2023. CASA Ratio stood at 46.8% as of December 31, 2023. Retail deposits grew by 46.6% YoY from Rs 95,107 crore as of December 31, 2022, to Rs 1,39,431 crore as of December 31, 2023. Retail deposits constitute 79% of total customer deposits as of December 31, 2023. Legacy High Cost Borrowings reduced from Rs 18,762 crore as of December 31, 2022, to Rs 13,607 crore as of December 31, 2023. Funded Assets Funded assets (including advances & credit substitutes) increased by 24.5% YoY from Rs 1,52,152 crore as of December 31, 2022, to Rs 1,89,475 crore as of December 31, 2023. The Bank continues to wind down infrastructure financing as per the stated strategy and now constitutes only 1.6% of total funded assets as of December 31, 2023. Exposure to top 20 single borrowers improved to 5.93% as of December 31, 2023. The Credit Deposit Ratio improved further from 109.18% as of December 31, 2022, to 101.41% crore as of December 31, 2023. The incremental Credit to Deposit ratio for quarter 9MFY24 was 79.89% Assets Quality Gross NPA (GNPA) of the bank has improved to 2.04% as of December 31, 2023, from 2.96% on December 31, 2022. Net NPA (NNPA) of the bank has improved to 0.68% as of December 31, 2023, from 1.03% of December 31, 2022. GNPA of the Retail, Rural, and SME Finance has improved to 1.45% as of December 31, 2023, from 1.87% of December 31, 2022. NNPA of the Retail, Rural, and SME Finance has improved to 0.51% as of December 31, 2023, from 0.70% of December 31, 2022. Excluding the infrastructure financing book which the Bank is running down, the GNPA and NNPA of the Bank would have been 1.66% and 0.47% respectively as of December 31, 2023. SMA-1 and SMA-2 (31-90 DPD which is the pre-NPA stage) in Retail, Rural, and SME Finance portfolio has reduced from 0.87% as of March 31, 2023, to 0.85% as of December 31, 2023. Collection efficiency for urban retail business (excluding prepayments and EMI arrears) in the current bucket continues to remain high at 99.6%. Provision coverage ratio (including technical write-off) of the bank has increased to 84.68% as of December 31, 2023, from 76.60% as of December 31, 2022. Standard restructured book as % of total funded assets improved to 0.35% on December 31, 2023. Capital Position & Liquidity Capital Adequacy of the Bank was strong at 16.73% with a CET-1 Ratio at 13.95% as of December 31, 2023. The Bank raised fresh equity capital of Rs 3,000 crore in 1st week of October 2023. Average LCR was strong at 121% for the quarter ending on December 31, 2023. V Vaidyanathan, Managing Director and CEO, IDFC FIRST Bank, said, “We are happy to share that our deposits continue to grow strongly at 43% YoY, and our CASA ratio continues to be strong at 46.8%. Our asset quality continues to improve. On the Retail, Rural & SME business, which is a significant part of our business, the Gross NPA and Net NPA continue to remain low and are at 1.45% and 0.50% respectively as of 31st December 2023. We will remain very watchful on this front all the time. We have registered a profit of Rs 2,232 crore in 9MFY24, representing a growth of 37% over PAT of Rs 1,635 crore in 9MFY23. At the time of the merger of IDFC Bank and Capital First, the Bank provided Guidance 1.0. As of 31st December 2023, IDFC FIRST Bank has completed exactly 5 years post the merger and hence we are providing Guidance 2.0 (FY 24-29), with greater visibility as compared to the visibility we had at the time of providing Guidance 1.0. We are likely to meet most targets under Guidance 1.0” Result PDF22-01-2024
IDFC First Bank Ltd - 539437 - IDFC FIRST Bank Limited - Audio Recording Of Earnings Call (Q3-FY24)
Audio recording of Earnings Call for Q3FY24.21-01-2024
IDFC First Bank posts 716 crore PAT for Q3, up 18 per cent YoY
The lender expects profitability to touch 12,000-13,000 crore by the end of FY29, with RoA of 1.9-2 per cent and RoE of 17-18 per cent20-01-2024
IDFC First Bank Results Earnings Call for Q3FY24
Conference Call with IDFC First Bank Management and Analysts on Q3FY24 Performance and Outlook. Listen to the full earnings transcript.20-01-2024
IDFC First Bank Ltd - 539437 - Investor Presentation - Unaudited Standalone And Consolidated Financial Results ('Financial Results') Of IDFC FIRST Bank Limited ('Bank') For The Quarter And Nine Months Ended December 31, 2023.
Investor Presentation in relation to Financial Results for the Quarter ended December 31, 2023.20-01-2024
IDFC First Bank Ltd - 539437 - Compliance Under Regulations 32 Of The Securities And Exchange Board Of India (Listing Obligations And Disclosure Requirements) Regulations, 2015, As Amended ('SEBI Listing Regulations'), For Quarter Ended December 31, 2023.
Pursuant to Regulation 32 of SEBI Listing Regulations, we hereby confirm that the Bank has fully utilized the issue proceeds raised to QIP for the for the objects for which they were raised in accordance with the Placement Document. Further, there was no deviation in the utilization of funds raised through QIP.20-01-2024
IDFC First Bank Ltd - 539437 - Press Release - Unaudited Standalone And Consolidated Financial Results ('Financial Results') Of IDFC FIRST Bank Limited ('Bank') For The Quarter And Nine Months Ended December 31, 2023.
Please find enclosed the Press Release in connection with Financial Results for the Q3-FY2420-01-2024
IDFC First Bank Ltd - 539437 - Announcement under Regulation 30 (LODR)-Change in Directorate
Appointment of Ms. Matangi Gowrishankar as an Additional Director in the category of Independent Director of the Bank.20-01-2024
IDFC First Bank Ltd - 539437 - Unaudited Standalone And Consolidated Financial Results For Quarter And Nine Months Ended December 31, 2023.
Please find enclosed herewith Unaudited Standalone and Consolidated Financial Results for the quarter and nine months ended December 31, 2023 duly approved by the Board of Directors of the Bank at their meeting held on January 20, 2024 along with the Limited Review Report issued by the Joint Statutory Auditors of the Bank20-01-2024