Neutral IDFC First Bank; target of Rs 95: Motilal Oswal

Motilal Oswal recommended Neutral rating on IDFC First Bank with a target price of Rs 95 in its research report dated October 29, 2023.

Broker Research

October 30, 2023 / 15:09 IST

Neutral

26 Aug, 2025 12:21

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Motilal Oswal's research report on IDFC First Bank

IDFC First Bank (IDFCFB) reported 2QFY24 PAT of INR7.5b (up 35% YoY, slight 4% miss), led by robust revenues. NII grew 32% YoY, led by healthy loan growth and largely stable margins (down 1bp QoQ to 6.32%). Loan book (incl. credit subs) grew 28%YoY/7% QoQ. Deposit growth was healthy at 39% YoY, with CASA mix broadly stable at 46.4%. IDFCFB is well poised to deliver healthy loan growth, led by robust traction across retail, while drag from the wholesale book continues to moderate. However, higher opex will curb the pace of RoA expansion. IDFCFB stock has delivered ~60% return since we initiated coverage on the stock in Oct-22.

Outlook

However post sharp outperformance over past one year the stock now offers a limited upside to our revised fair value. We estimate bank to deliver 30% earnings CAGR over FY23-26 with RoA/RoE thus reaching to 1.33%/13.6% in FY26. We downgrade our rating to Neutral with a revised TP of INR95.

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