AgenciesRelated
Motilal Oswal has buy call on Ltd. with a target price of Rs 110. The current market price of Federal Bank Ltd. is Rs 77.5.
Federal Bank Ltd., incorporated in the year 1931, is a banking company (having a market cap of Rs 15487.84 Crore).
Financials
For the quarter ended 31-12-2020, the company reported a Consolidated Total Income of Rs 4088.77 Crore, down -1.03 % from last quarter Total Income of Rs 4131.32 Crore and up 6.63 % from last year same quarter Total Income of Rs 3834.71 Crore. The bank reported net profit after tax of Rs 418.14 Crore in latest quarter.
Investment Rationale
FB posted a sharp increase in its loan base, which is expected to be driven by healthy growth in its retail asset portfolio (led by gold loans). Deposit traction came in robust, while the bank’s liability franchise remains strong, with a retail deposit mix of over 90%. Thus, low cost of funds –coupled with an uptick in loan growth and the sequential deployment of liquidity – is likely to keep margins steady. On the asset quality front, proforma PCR stood healthy at ~66%, while the restructuring book was controlled at ~1.3%; this would keep the asset quality steady. Nevertheless, the brokerage expects credit cost to remain higher in the near term.
Promoter/FII Holdings
Promoters held 0 per cent stake in the company as of Sept 30, 2020, while FIIs held 25.8 per cent, DIIs 37.7 per cent and public and others 36.5 per cent.
Federal Bank Ltd., incorporated in the year 1931, is a banking company (having a market cap of Rs 15487.84 Crore).
Financials
For the quarter ended 31-12-2020, the company reported a Consolidated Total Income of Rs 4088.77 Crore, down -1.03 % from last quarter Total Income of Rs 4131.32 Crore and up 6.63 % from last year same quarter Total Income of Rs 3834.71 Crore. The bank reported net profit after tax of Rs 418.14 Crore in latest quarter.
Investment Rationale
FB posted a sharp increase in its loan base, which is expected to be driven by healthy growth in its retail asset portfolio (led by gold loans). Deposit traction came in robust, while the bank’s liability franchise remains strong, with a retail deposit mix of over 90%. Thus, low cost of funds –coupled with an uptick in loan growth and the sequential deployment of liquidity – is likely to keep margins steady. On the asset quality front, proforma PCR stood healthy at ~66%, while the restructuring book was controlled at ~1.3%; this would keep the asset quality steady. Nevertheless, the brokerage expects credit cost to remain higher in the near term.
Promoter/FII Holdings
Promoters held 0 per cent stake in the company as of Sept 30, 2020, while FIIs held 25.8 per cent, DIIs 37.7 per cent and public and others 36.5 per cent.
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