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Synopsis : IDFC First Bank's shares rose 53% in a year. Outlook for further growth is discussed.
Over the past year, IDFC First Bank shares have experienced a remarkable surge of 53% from their lowest point, reaching Rs 82.79 in the current session after hitting a low of Rs 53.90 on April 17 last year. In contrast, the Bank Nifty has seen a 14% increase during the same period.
During Monday's trading, a total of 33.75 lakh shares changed hands, representing a turnover of Rs 27.87 crore on the BSE. Despite a 53% rise over the year, the banking stock experienced a 6% decrease in 2024.
Analyzing the technical indicators, the relative strength index (RSI) for the banking stock currently stands at 64, indicating that the stock is neither oversold nor overbought. IDFC First Bank shares are trading above their 10-day, 20-day, 30-day, and 50-day moving averages, but below their 5-day, 100-day, 150-day, and 200-day moving averages.
Aditya Gaggar of Progressive shares anticipates the banking stock to achieve a target range of Rs 104 to Rs 124 over the next 6 to 9 months. Gaggar highlights the end of a 7-month consolidation period with a Bullish Flag and Pole Formation breakout, supported by leading indicators such as RSI and MACD.
Global brokerage Jefferies has initiated coverage on the private sector lender with a 'buy' recommendation and a target price of Rs 100. The brokerage emphasizes IDFC First Bank's robust platform and improved deposit franchise, projecting a 28% EPS CAGR over FY24-27 despite rising credit costs.
In the December 2023 quarter, the lender reported an 18% increase in net profit to Rs 715.68 crore compared to Rs 605 crore in Q3 FY23. Additionally, gross non-performing assets (NPAs) decreased to 2.04% in Q3 from 2.96% in Q3 FY23, while net NPAs stood at 0.68%, up from 1.03% year-on-year. Net interest income (NII) surged by 30% to Rs 4,287 crore in Q3 compared to the same quarter last year.
