IDFC First Bank Ltd.Strong Momentum with 145% PAT Growth

IDFC First Bank delivered robust underlying performance in Q4 FY26, with normalized profit after tax reaching ₹746 crore, marking a remarkable 145% year-on-year growth despite a fraud incident impact.

The bank's loan book expanded strongly by 20% YoY to ₹2.9 lakh crore, while deposits grew 16.8% to ₹2.94 lakh crore. Asset quality showed significant improvement with credit costs declining to 1.63%, the lowest in years, as the microfinance crisis resolved. Net interest margin stood at 5.93% for the quarter. Management emphasized that the lending business generates a strong 1.5-1.6% ROA, currently offset by a 1% drag from deposit franchise investments.

For FY27, the bank guided 18-18.5% top-line growth, stable NIM around 5.75%, and credit costs of 170-180 basis points. The deposit franchise is expected to turn profitable in four to five years, unlocking full earnings potential. Management expects deposits to resume 5% quarterly growth from Q1 FY27 after transient Q4 headwinds.