26-Oct-2026 08:50:34
UBS on IDFC First BK ; Neutral, TP Rs 82
Reported PAT of Rs10.45bn, up 196.5% YoY but down 2.8% QoQ, with core PAT rising 15.5% QoQ to Rs10.36bn. NII grew 21% YoY/3.5% QoQ, while NIM moderated 32bp QoQ to 5.58%, primarily due to denominator impact of FCNR-backed lending, surplus liquidity & changes in asset mix Fee and other income grew 24.5% YoY, supporting 21.9% growth in core operating income. Opex increased 16% YoY, with positive operating jaws of c590bp driving 38.5% YoY growth in core operating profit. Reported C/I ratio improved 358bp YoY/57bp QoQ to 70.2%, although it remains elevated. Provisions declined 21.7% YoY and were broadly flat QoQ, despite Rs1bn of standard provisions on FCNR-backed loans. Credit cost moderated to 1.38% of average funded assets and 1.01% of average assets, while RoA stood at 0.93% Management expects NIM to recover to c5.8% by 4QFY27 and retained its 1.5-1.6% credit cost guidance on loans
IDFC FIRST BANK LIMITED