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Informist, Friday, Jan. 30, 2026

 

By Shweta

 

MUMBAI – IDFC FIRST Bank Ltd. is expected to post a strong on-year growth in net profit for the December quarter, according to brokerages tracking the company. The growth is expected to be mainly driven by a sharp increase in treasury income and advances, supported by contained credit costs.

 

The private sector lender's bottom line is likely to rise 47% on year to nearly INR 5 billion for the December quarter, as per the average of estimates from six brokerages. The bank had reported a net profit of INR 3.39 billion in the year-ago quarter and INR 3.52 billion in the September quarter. The highest estimate for the company's net profit is INR 5.64 billion from Emkay Global Financial Services Ltd. The lowest estimate is INR 4.02 billion from YES Securities (India) Ltd. The bank will announce its December quarter earnings Saturday.

 

The Mumbai-based, mid-sized private sector lender is expected to report a net interest income of INR 53.84 billion for the reporting quarter, up nearly 10% on year, according to the average of estimates. The highest estimate for the company's net interest income is INR 54.45 billion by Motilal Oswal Financial Services Ltd. The lowest estimate is INR 52.97 billion by YES Securities.

 

The bank's net profit and net interest income will be supported by loan growth in the reporting quarter. The bank's December quarter loans are estimated to grow 20-22% on year to around INR 2.7 trillion, according to the average of estimates from four brokerages. "NII growth will be slower than average loan growth due to fall in yield on advances outpacing cost of deposits," according to YES Securities.

 

"Higher growth, flat NIM (net interest margin), and contained credit cost to support a sequential uptick in profitability. Slippages to remain range-bound," Emkay said in a report. The treasury income is likely to see a two-fold jump on year to INR 600 million, as per Elara Securities (India) Pvt. Ltd.

 

IDFC FIRST Bank's net interest margin is expected to fall 35-41 basis points on year to around 5.63% from 6.04% in the year-ago quarter, according to Nuvama Wealth Management Ltd. and ICICI Securities Ltd. Brokerages have mixed views about the bank's net interest margin on a sequential basis. Nuvama, ICICI Securities, and Motilal Oswal expect the bank's net interest margin to rise up to 11 bps on quarter. In contrast, Emkay and YES Securities expect the lender to report a marginal fall in its net interest margin sequentially. The private sector lender's net interest margin was 5.59% in the trailing quarter.

 

The bank's management had said that it expects net interest margin to be over 5.8% by the end of the financial year. "We are also pencilling in one more repo cut when we are giving this guidance," the management had said in a post-earnings September quarter conference call on Oct. 18. The Reserve Bank of India's Monetary Policy Committee subsequently cut the key repo rate by 25 bps in December.

 

IDFC FIRST Bank's deposits are likely to jump up 21-24% to INR 2.9 trillion in the December quarter, according to three estimates. Analysts expect the deposits to rise as the bank had said it will focus on mobilising deposits and reduce borrowings to address concerns about the credit-deposit ratio.

 

The private sector bank's shares are up over 8% since its September quarter earnings were reported. At 1419 IST Friday, the shares were at INR 83.75 on the National Stock Exchange, up 0.3% from the previous day's closing level.

 

Of the seven brokerage reports on the bank available with Informist, six have a 'buy' rating on the stock with an average target price of INR 89. This is almost 7% higher than the current market price. One brokerage has a 'hold' rating with a target price of INR 68.

 

Following are the December quarter earnings estimates of IDFC FIRST Bank from six brokerages in descending order of the estimate of net profit in INR billion:

 

Brokerages	NII	Net Profit
Emkay Global Financial Services Ltd	53.75	5.64
Elara Securities (India) Pvt Ltd	53.63	5.40
ICICI Securities Ltd	54.02	5.21
Motilal Oswal Financial Services Ltd	54.45	5.01
Nuvama Wealth Management Ltd	54.20	4.70
YES Securities (India) Ltd	52.97	4.01
Average	53.84	5.00

 

End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Ashish Shirke

 

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