IDFC First Bank (IDFCFIRSTB) Q4 24/25 earnings summary

Executive summary

• Balance sheet grew 16% YoY to INR 3.4 lakh crore as of March 31, 2025, with customer deposits up 25% and retail deposits up 26%.

• Total loan book rose 20.4% YoY, led by mortgages (+19%), vehicle loans (+26%), business banking (+32%), and wholesale (+29%).

• Net profit declined 48.4% YoY to US$179M, mainly due to higher provisions in microfinance.

• Asset quality stable: GNPA at 1.87%, NNPA at 0.53% as of Mar-25; provision coverage at 72.3%.

• Board approved US$882M capital raise and Rs.0.25/share dividend, subject to approvals.

Financial highlights

• Net interest income grew 17% YoY for FY25; NIM on AUM at 5.95%.

• Fee and other income up 15% YoY; retail fees comprise 92% of total.

• Operating expenses growth moderated to 16.5% for FY25; cost-to-income ratio stable at 73%.

• Provisions for FY25 at INR 5,515 crore (up 131.6% YoY), mainly due to microfinance and a legacy toll account.

• PAT for FY25 at INR 1,525 crore; Q4 PAT at INR 304 crore, impacted by microfinance.

Outlook and guidance

• Loan book growth targeted at ~20%, deposit growth at 22-25% for FY26.

• OPEX growth targeted at 12-13% for FY26, leveraging operating efficiency.

• Credit cost expected to reduce to 1.85-1.90% in FY26, down from 2.46% in FY25.

• NIM expected to decline by ~10 bps over Q4 FY25 due to repo rate cuts and deposit rate reductions.

• ROE targeted to reach 15-16% over the next few years; aiming for 1% ROA by end of FY26.