In just a year, IDFC First Bank's shares have increased 53% from their 52-week low. The banking stock was trading at Rs 82.79 during the current session. It had hit a 52-week low of Rs 53.90 on April 17 of last year. The Bank Nifty, on the other hand, has increased by 14% in a year.
Early on Monday, IDFC First Bank shares dropped 1.96% to Rs 82.79. The bank's market capitalization decreased to Rs 58,489 crore. 33.75 lakh shares in total changed hands on the BSE, translating into a transaction of Rs 27.87 million. In 2024, the banking shares fell 6% after rising 53% in the previous year.
Technically speaking, the banking stock's relative strength index (RSI) is 64, indicating that it is neither overbought nor oversold. The 10 day, 20 day, 30 day, and 50 day moving averages are all higher than the shares of IDFC First Bank, while the 5 day, 100 day, 150 day, and 200 day moving averages are lower.
In six to nine months, Aditya Gaggar of Progressive Shares anticipates that the banking stock would reach its goal of Rs 104 to Rs 124.
According to Gaggar, a bullish flag and pole formation breakthrough signal the conclusion of a consolidation that lasted more than seven months. "A falling trendline breakthrough and a concealed bullish divergence, both indicated by the leading indicator RSI, validate price action. Positively, the +DMI has crossed the -DMI, and a reading of 21 denotes the start of a significant trend. "MACD is about to give a positive crossover," he continued, providing the justification for his optimistic assessment of the banking stock. Jefferies, a global brokerage, has started covering the private sector lender with a target price of Rs 100 and a 'buy' call.
"IDFC First Bank has developed a robust platform that is likely one of the best deposit franchises out there. Operational improvements will become apparent in H2FY25, and robust deposit growth will support loan growth throughout FY24–27, which should support a 28 percent compound annual growth rate of earnings per share (EPS) despite rising credit costs. Enhancing ROE (to 14%) and ROA (to 1.5%) will help with rerating. It should benefit more from a rate decline than its rivals. The capacity to raise money will be essential. The brokerage stated, "We begin coverage with a Buy rating and a price objective of Rs 100.
Compared to Rs 605 crore in Q3 FY23, the lender's net profit increased by 18% to Rs 715.68 crore in the December 2023 quarter.
Gross non-performing assets (NPA) decreased from 2.96 percent in Q3 FY23 to 2.04% in Q3. The bank's net non-performing assets (NPAs) increased from 1.03 percent to 0.68 percent in the third quarter of the year. In comparison to the same quarter last year, when net interest income (NII) was Rs 3,286 crore, it increased by 30% to Rs 4,287 crore in the third quarter.
