More Stories

Informist, Thursday, Apr. 23, 2026

By Aaryan Khanna

NEW DELHI – IDFC FIRST Bank is likely to have a strong March quarter operationally, with higher-than-average loan growth and expanding net interest margins. However, the bank's bottom line is likely to be severely hit by the fraud in the accounts linked to the Haryana government in its Chandigarh branch during the quarter.

The private-sector lender is expected to post a net profit of INR 2.48 billion for the March quarter, down 18% on year and less than half the INR 5.68 billion it posted in the December quarter, according to the average of estimates from nine brokerages. The highest estimate for the net profit is INR 5.43 billion from Equirus Securities Pvt. Ltd. and the lowest is INR 500 million from Nomura Equity Research. IDFC FIRST Bank will announce its results on Saturday.

In March, the bank paid out INR 6.45 billion to the Haryana government as claims, INR 550 million more than its initial estimate of INR 5.90 billion. These claims were part of a fraud involving Haryana government accounts detected at the bank's Chandigarh branch in February. Investor sentiment took a beating after the incident, and the bank's shares have not recovered after tumbling nearly 20% following the disclosure.

Nomura expects a near-wipeout of its net profit in Jan-Mar despite healthy topline growth. Others said the fraud would lead to higher provisioning. However, ICICI Securities Ltd. said that the bank could use its contingent buffer of INR 1.65 billion to offset some of the impact of the discrepancy in the account.

While the credit cost will moderate sequentially, the impact of the deposit fraud will keep net profit muted at INR 500 million, Nomura said in its pre-earnings report. The bank management's commentary on asset quality and operating leverage will be the key points to watch, the brokerage said. 

The bank's net interest income is seen growing 16.4% on year to INR 57.10 billion in the March quarter, according to the average of estimates from nine brokerages. Sequentially, the net interest income is seen rising 4.0%. Most brokerages see the net interest margin rising by 5-9 basis points from 5.76% in Oct-Dec, with Nomura an outlier, expecting the margin to remain steady on quarter.

"NII (net interest income) growth will be slightly higher than average loan growth due to rise in yield on advances outpacing cost of deposits," YES Securities (India) Ltd. said. "Sequential fee income growth will be higher than loan growth. Opex growth would be lower than business growth."

The bank's total advances grew around 20% on year to INR 2.90 trillion as of Mar. 31, according to provisional data released by the bank earlier this month. Deposit growth lagged behind loan portfolio growth at 17.2% on year to INR 2.84 trillion. Analysts said the bank's credit-deposit ratio likely rose sharply sequentially, with deposit accretion hurt by the fraud reported in February.

Apart from the fraud, analysts had mixed views on the bank's provisions in the reporting quarter. Nomura said provisions may fall due to a seasonal improvement in loans to the agriculture sector, with recovery in unsecured retail loans also likely to help. YES Securities said seasonality would be adverse for fresh slippages, leading to more provisioning. In the December quarter, IDFC FIRST Bank reported net provisions of INR 13.98 billion.

"We expect lower slippages, and credit cost is to be contained. The recent episodes will feed into one-time hit, which would impact profitability," Elara Securities said in its pre-earnings report. "Management commentary on sustaining growth momentum and cost outcomes would be monitored."

The bank's shares are down around 19% since it declared its December quarter earnings on Jan. 31, falling 0.8% Thursday to INR 67.83 on the National Stock Exchange. Of the nine brokerage reports on the bank available with Informist, seven have a "buy" recommendation with an average target price of INR 89. Two brokerages have a "hold" or equivalent call at a target price of INR 80.

The Following are the earnings estimates for IDFC FIRST Bank for the March quarter from nine brokerages in descending order of the estimate of net profit in INR billion:

End

Edited by Saji George Titus

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2026. All rights reserved.