26-Oct-2026 08:51:06
GS on IDFC First BK ; Neutral, TP Rs 85
2QFY27 largely in-line with expectations, with PAT of Rs10.5bn (0.9% annualized RoA). Core PPoP growth 2% above GSe helped by core revenue growth (+22% YoY) continued to outpace cost growth (+16% YoY), in-line with the bank's guidance of delivering an operating jaw of 500bps+. Loan growth (ex-FCNR-B) remained strong at 21% YoY (+5% QoQ), with management sounding confident on sustaining 20%+ growth, while deposit growth excluding FCNR-B moderated to 14% YoY as the bank consciously ran down high-cost bulk deposits. NIMs excluding FNCR-B related impact declined by 16bps QoQ driven mainly by higher excess liquidity/asset mix shift and an adverse day-count impact Bank expects strong reversal in F4Q27. Management guided to a recovery toward 5.8% NIM by 4QFY27 (compared to 5.9% in F1Q27 and 5.58% in F2Q27). Asset quality remained steady, with underlying credit cost moderating QoQ to 1.3% (1.5% last quarter) and PCR healthy at ~70%.
IDFC FIRST BANK LIMITED