Will IDFC First Bank Ltd be the “next HDFC Bank”?
IDFC First bank is engaged in the business of Banking Services. The bank started operations on 1 October 2015. Due to various reasons, there is a high possibility to outperform the bank (in coming years). MD-CEO, Mr. V. Vaidyanathan, who has over 25 years of banking experience across Icicibank and Citibank Group is the key person the entire Banking world is looking at.
Management is having a splendid strategy for catering new customers and the bank is focusing on retail segment instead of Corporate segments or wholesale segments. The Bank has made lightening progress in retailization of Liabilities. Retail liabilities now comprise 72% of customer deposits, up from 27% at merger.
Several features of this change
- Improved lending practices with (low) Gross NPA ratio of 1.62, which creates a possibility for more room for growth.
- IDFC First Bank has a high Capital Adequacy Ratio of 17.07% signifying high buffers against its risk based assets.
- Net Interest Income has grown by an annual rate of 144.97%.
- The company has declared Positive results for the last 3 consecutive quarters
- NII(Q) Highest at Rs 1,659.73 cr
- GROSS NPA(Q) Lowest at 1.62 %
- PBT LESS OI(Q) Highest at Rs -42.03 cr.
- Average CASA ratio for Q3 at 44.6% vs 20.9% (YOY)
- CASA ratio on outstanding deposits a on Dec 31, 2020 is at 48.4%.
- High Institutional Holdings at 26.95%
- Retail deposits including CASA and term deposits of IDFC First doubled to 584.35B rupees as of Dec 31st.
- Customer deposits up41% (YOY) to 772.89B as on Dec 31, 2020.
- Company with Zero promoter Pledge.
- GNPA 1.62% as of Sep 2020
- NNPA 0.43% as of Sep 2020
- Stock gained more than 20% in one month.
- The Retail funded asset cover 56% of the total business which is much welcome for a banking sector.
- As on Sep 30, 2020, it has a network of 523 branches and 509 ATMs across the country. The bank is led by
Stock is technically in a Bullish range. The technical trend has improved from Mildly Bullish on 31-Dec-20 and has generated 23.62% returns since then Multiple factors for the stock are Bullish like MACD, Bollinger Band, KST and OBV.