Earnings Outlook
Steep fall in NIM to pull Bandhan Bank Q3 PAT down YoY
This story was originally published at 18:29 IST on 21 January 2026
Register to read our real-time news.Informist, Wednesday, Jan. 21, 2026
By Nandini Sinha
MUMBAI - Bandhan Bank Ltd. is expected to report a fall in its on-year net profit for the December quarter due to a steep fall in the net interest margin, according to brokerages. However, the net profit is expected to rise sharply on a sequential basis on sale of stressed assets.
Bandhan Bank's net profit for the December quarter is estimated to fall nearly 16% on year to INR 3.6 billion, according to the average of estimates from eight brokerages. The net profit is expected to rise more than 220% sequentially, driven by the sale of INR 68 billion of stressed assets to an asset reconstruction company.
The highest estimate for the private sector bank's December quarter net profit is INR 8.62 billion by Nirmal Bang Equities Pvt. Ltd., while the lowest estimate is INR 1.84 billion by Elara Securities (India) Pvt. Ltd.
Bandhan Bank's net interest income is expected to rise nearly 5% sequentially to INR 27.16 billion. It is expected to fall nearly 4% on year. The bank's net interest income in the trailing quarter was INR 25.89 billion.
The highest estimate for the bank's net interest income is INR 28.84 billion by Nirmal Bang, while the lowest estimate is INR 26.40 billion by Emkay Global Financial Services Ltd.
The bank's net interest margin is expected to fall 93-106 basis points on year. Most brokerages expect it to rise sequentially, except Emkay Global. It is expected to rise 4-10 bps on quarter, according to four brokerages.
"The bank has sold NPAs as well as written-off loans, but would consume the one-off gains to recoup the provisions. Slippages to remain elevated," Emkay Global said.
Bandhan Bank sold non-performing assets and wrote off loans of over INR 68 billion to asset reconstruction companies in December. It sold unsecured NPA portfolio worth INR 31.65 billion for INR 5.7 billion to Asset Reconstruction Co. (India) Ltd. and recovered 18% of the asset value. The bank also sold unsecured written-off portfolio worth INR 37.07 billion for INR 3.32 billion to Phoenix ARC Pvt. Ltd. and recovered 9% of the asset value.
The private sector bank's provisions are expected to decline on quarter to INR 10.4 billion from INR 11.5 billion. Bandhan Bank's advances were INR 1.45 trillion as on Dec. 31, up 10% on year and 3.7% on quarter. Its total deposits were INR 1.57 trillion, up 11% on year. However, deposits were down nearly 1% on quarter.
Of the nine brokerage reports on the bank available with Informist, two have a 'buy' recommendation with an average target price of INR 188. This is 27% higher than current market price. Four brokerages have a 'hold' recommendation on the stock for an average price of INR 174 and three brokerages have a 'sell' recommendation for an average target price of INR 155.
Bandhan Bank shares have fallen nearly 12% since it announced its September quarter earnings. Shares of the bank Wednesday closed at INR 137.98 on the National Stock Exchange, down over 1% from the previous day. The private sector bank will detail its December quarter earnings on Thursday.
Following are the December quarter earnings estimates of Bandhan Bank from eight brokerages in descending order of the estimate of net profit in INR billion:
|
BROKERAGE NAME |
NET INTEREST INCOME |
NET PROFIT |
|
Nirmal Bang Equities Pvt. Ltd. |
28.84 |
8.61 |
|
Emkay Global Financial Services Ltd. |
26.40 |
4.23 |
|
ICICI Securities Ltd. |
26.41 |
3.81 |
|
Motilal Oswal Financial Services Ltd. |
27.51 |
2.73 |
|
Nuvama Wealth Management Ltd. |
27.60 |
2.70 |
|
Kotak Securities Ltd. |
26.88 |
2.54 |
|
JM Financial Institutional Securities Pvt. Ltd. |
26.61 |
2.28 |
|
Elara Securities (India) Pvt. Ltd. |
26.97 |
1.83 |
|
|
|
|
|
Average |
27.15 |
3.59 |
End
Edited by Ashish Shirke
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