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IDFC First Bank Q4FY20 Results: Stock Analysis | Investyadnya Stock Article

IDFC First Bank Stock Analysis based on Q4FY20 results

Published on 28 May 2020 Views 120 Comments 0


IDFC First Bank in Q4 FY20 posted a net profit of Rs.72 Cr on account of a robust growth across Net Interest Income, Non-Interest Income, CASA deposits and Retail Loan Book. Also, there was a decline in provisions QoQ by almost 70%, due to which Bank’s Net Profit has come into the positive territory for the first time since the merger.

IDFC First Bank Stock Analysis based on Q4FY20 Results

IDFC First Bank: Detailed Stock Analysis

IDFC First Bank (after the merger of Erstwhile Capital First with IDFC Bank) is engaged in the business of Banking Services, thus offering a range of financial solutions to individuals, small businesses and corporates.

This video offers IDFC First Bank Stock Analysis, with a detailed analysis of the company’s quarterly results and also the wholesale & retail loan mix of the bank. It further highlights IDFC First Bank financials, including Gross & Net NPA, Net Interest Margin (NIM), CASA Ratio. Capital Adequacy ratio, etc. Moreover, the figures of Loans under Moratorium are also discussed, which appears to be higher than the industry average. This can be a point of concern for retail investors invested in IDFC First Bank stock.

IDFC First Bank Result Analysis

IDFC First Bank in Q4 FY20 posted a net profit of Rs.72 Cr on account of robust growth across Net Interest Income, Non-Interest Income, CASA deposits and Retail Loan Book. Also, there was a decline in provisions of QoQ by almost 70%, due to which Bank’s Net Profit has come into the positive territory for the first time since the merger.

The video also highlights IDFC First Bank financial results, including interest income, interest expense, operating income & expenses, etc. The users can also get figures of IDFC First Bank balance sheet size.

IDFC First Bank Q4 FY20 Results: IDFC First Bank Quarterly Results

Net Interest Income (NII)

      NII is a critical parameter for analysing the core business growth of the bank.

      Net Interest Income = (Interest Income – Interest Expenses)

      Interest Expenses are nothing but the financial cost incurred by the bank while raising funds which are going to be available for the lending.

      Net Interest Income is increased by 40% YoY driven by:

      Robust YoY growth in CASA deposits (162%) and Retail Term Deposits (107%)

      Decline in Interest Expenses by 5% YoY due to a 6% fall in total borrowings

      Improved Net Interest Margin QoQ as well as YoY

IDFC First Bank: Profitability

Pre-provisioning Operating Profit (PPOP): IDFC First Bank Fundamentals

      Operating Profit before making provisions is called as Pre-provisioning Operating Profit (PPOP)

      PPOP = (Total Operating Income – Operating Expenses)

      Pre-provisioning Operating Profit is increased by almost 70% YoY (Excluding Trading Gains) on account of:

      Robust growth in NII by 40% & Operating Income by 67% YoY

      Fall in Interest Expenses by 5% YoY

Net Profit: IDFC First Bank Fundamental Analysis

      In Q4 FY20, the bank made total provisions of Rs.679 Cr up 4% YoY, out of which COVID-Related provisions were Rs.225 Cr.

      Profit Before Tax (PBT) in Q4 FY20 was at Rs.107 Cr from a loss of Rs.417 Cr last year in the same quarter.

      IDFC First Bank’s financial performance has come into the positive territory for the first time in Q4 FY20 after the IDFC Bank and Capital First merger last year in Q3 FY19.

      It is a very positive sign for the bank that it is successfully consolidating its balance sheet and building a Retail-oriented Business Model under the visionary leadership of Mr V. Vaidyanathan, MD & CEO IDFC First Bank.

      Net Profit for Q4 FY20 stood at Rs.72 Cr from a loss of Rs.218 Cr in Q4 FY19. Thus, Q4 FY20 is a quarter delivering a Loss to Profit YoY.

Make A Viable Investment Decision with IDFC First Bank Company Analysis

The investors can check out the financial statements & quarterly results of the company, along with IDFC First Bank share price, on the stock-o-meter feature of our website.

Despite the evident losses, it can be incurred that the company has strong management. Thus, it is expected that the situation will improve. Through the video, it can be observed that IDFC Bank share can be suitable for aggressive investors, depending upon the risk profile etc. IDFC first bank offers fair valuations, but the risk is high.

Thus, with this IDFC First bank research report, the investors will be able to make a viable investment decision.

Invest Yadnya’s Other Resources For Detailed Stock Analysis

To get deeper insights into IDFC First Bank Analysis, check out other resources available on our website. Get a detailed IDFC First Bank stock review, with our stock articles on Q1 FY21, Q2 FY20 & Q3 FY20 Result Analysis. You can also check out our e-book on IDFC First Bank Ltd - Company Analysis & get an in-depth IDFC First Bank share analysis.

Make all your investment decisions with us, as we offer quality financial advice. For more of such quality content, check out Invest Yadnya

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      NII is a critical parameter for analysing the core business growth of the bank.

      Net Interest Income = (Interest Income – Interest Expenses)

      Interest Expenses are nothing but the financial cost incurred by the bank while raising funds which are going to be available for the lending.

      Net Interest Income is increased by 40% YoY driven by:

      Robust YoY growth in CASA deposits (162%) and Retail Term Deposits (107%)

      Decline in Interest Expenses by 5% YoY due to a 6% fall in total borrowings

      Improved Net Interest Margin QoQ as well as YoY

IDFC First Bank: Profitability

Pre-provisioning Operating Profit (PPOP): IDFC First Bank Fundamentals

      Operating Profit before making provisions is called as Pre-provisioning Operating Profit (PPOP)

      PPOP = (Total Operating Income – Operating Expenses)

      Pre-provisioning Operating Profit is increased by almost 70% YoY (Excluding Trading Gains) on account of:

      Robust growth in NII by 40% & Operating Income by 67% YoY

      Fall in Interest Expenses by 5% YoY

Net Profit: IDFC First Bank Fundamental Analysis

      In Q4 FY20, the bank made total provisions of Rs.679 Cr up 4% YoY, out of which COVID-Related provisions were Rs.225 Cr.

      Profit Before Tax (PBT) in Q4 FY20 was at Rs.107 Cr from a loss of Rs.417 Cr last year in the same quarter.

      IDFC First Bank’s financial performance has come into the positive territory for the first time in Q4 FY20 after the IDFC Bank and Capital First merger last year in Q3 FY19.

      It is a very positive sign for the bank that it is successfully consolidating its balance sheet and building a Retail-oriented Business Model under the visionary leadership of Mr V. Vaidyanathan, MD & CEO IDFC First Bank.

      Net Profit for Q4 FY20 stood at Rs.72 Cr from a loss of Rs.218 Cr in Q4 FY19. Thus, Q4 FY20 is a quarter delivering a Loss to Profit YoY.

Make A Viable Investment Decision with IDFC First Bank Company Analysis

The investors can check out the financial statements & quarterly results of the company, along with IDFC First Bank share price, on the stock-o-meter feature of our website.

Despite the evident losses, it can be incurred that the company has strong management. Thus, it is expected that the situation will improve. Through the video, it can be observed that IDFC Bank share can be suitable for aggressive investors, depending upon the risk profile etc. IDFC first bank offers fair valuations, but the risk is high.

Thus, with this IDFC First bank research report, the investors will be able to make a viable investment decision.

Invest Yadnya’s Other Resources For Detailed Stock Analysis

To get deeper insights into IDFC First Bank Analysis, check out other resources available on our website. Get a detailed IDFC First Bank stock review, with our stock articles on Q1 FY21, Q2 FY20 & Q3 FY20 Result Analysis. You can also check out our e-book on IDFC First Bank Ltd - Company Analysis & get an in-depth IDFC First Bank share analysis.

Make all your investment decisions with us, as we offer quality financial advice. For more of such quality content, check out Invest Yadnya

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