Federal Bank Q3 Results Review - Flagged As A Top Pick In 2021, Marches On: Yes Securities

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Yes Securities Report.While Federal Bank Ltd. is now expected to deliver full year FY23 return on asset at 1.25% or slightly better, the FY24 RoA is expected to be 10 basis points higher than FY23 levels. Management stated that RoA improvement would not be dominated by any one single lever. The FY24 net interest margin guidance stands at 335-340 bps, which is the same as what is now expected for full year FY23. This is higher than the 330 bps guided for (for FY23) during the Q2 FY23 result call. While the new guidelines for fintech lending somewhat held back gold loans, management stated that gold loans could grow at the pace of 25%. They further stated that new lending segments, commercial vehicle finance, credit cards and microfinance could double from current levels of about Rs 60-70 billion. It has been observed that wage hikes have ranged between 10-15% in the past and a 15% hike has been assumed in making provisions. The wage provision impact amounts to about Rs 200 million per month and is effective November 01, 2022. Federal Bank has added more than 60 branches so far this financial year and should add about 75 in total for the year. The bank will then add about 80-90 branches per year for two years, taking the three-year total to about 250 branches..Click on the attachment to read the full report:.More Research Reports On Federal Bank's Q3 FY23 Results Review.Closing In On True Franchise Potential: HDFC Securities Strong Show; Positives Largely Priced In: Dolat Capital.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Federal Bank Q3 Results Review - Flagged As A Top Pick In 2021, Marches On: Yes Securities

Management enhanced RoA guidance for FY23 and FY24, with no single lever expected to be the dominant driver for RoA expansion

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