IDFC First Bank - Q2FY21 Result - Angel Broking

Mr. Jaikishan Parmar - Sr. Equity Research Analyst, Angel Broking Ltd

"IDFC First Bank reported very good set numbers for Q2FY21. Bank's liability franchisee building and retailisation of the book journey is going well ahead of management guidance. Total advance declined 1% YoY and grew 3% QoQ. However, the retail book grew at 25%/7% YoY/QoQ and the corporate book continues to decline. NII grew at 22% YoY and sequentially 2%, NIM% rose to 4.57% in Q2 FY21 from 3.43% in Q1 FY20 and 4.53% in Q1 FY21. Other income grew at a healthy rate owing to treasury gain. PPOP grew 92% YoY primarily owing to healthy NII and treasury gain.

On the Asset quality front, GNPA declined 12bps to 1.87% and PCR stands at 68%. Bank has released Rs.811 cr worth of provision from telecom exposure considering the improvement in financials. Same Rs.811 cr used to improve Covid led provision. during Q2-FY21, the Bank has taken additional provision of Rs. 1,400 crore towards COVID-19 to strengthen its balance sheet further. Including this, as of 30 September 2020, the Bank holds such provision of Rs. 2,000 crore which is 2.21% of its standard advances.

On deposit front bank continues to show very healthy numbers. Customer Deposit grew at 35% YoY /11% QoQ, CASA ratio grew at 660bps to 40.4%.

We have a BUY recommendation on IDFC First bank considering attractive valuation (0.9x FY22E Adj BV) and healthy traction in liability."

Shares of IDFC First Bank Ltd was last trading in BSE at Rs.30.65 as compared to the previous close of Rs. 30.6. The total number of shares traded during the day was 1398701 in over 26840 trades.

The stock hit an intraday high of Rs. 31.3 and intraday low of 30.25. The net turnover during the day was Rs. 42896533.

Source : Equity Bulls

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