RBL Financial institution share worth as we speak: Regardless of a pointy drop of over 80% in its consolidated web revenue for Q4FY25 (March quarter), RBL Financial institution’s share worth kicked off Monday’s buying and selling session positively and continued to construct on beneficial properties throughout early commerce, spiking 7% to the day’s excessive of ₹201.25 per share.
Even with the numerous fall in web revenue, the numbers got here in step with analysts’ estimates. Home brokerage agency Centrum Broking mentioned that RBL Financial institution’s outcomes for Q4FY25 had been broadly in step with expectations, with a beat on non-interest earnings (NII), offset by elevated credit score prices — a recurring theme.
Notably, the financial institution elevated its PCR by 700 foundation factors QoQ to 89%, due to the utilization of contingent provisions ( ₹2.73 billion). Encouragingly, there are early indicators of asset high quality enchancment: gross slippages declined 130 foundation factors QoQ, and the SMA pool for the JLG guide diminished to ₹3.8 billion from ₹5.5 billion.
Mixed with seasonal restoration tailwinds, this led to enhancements in GNPA and NNPA ratios, which are actually at 2.6% and 0.3%, respectively, the brokerage mentioned. Administration’s commentary means that the worst of the credit score price cycle is behind us, and FY26 is anticipated to be materially higher by way of development and profitability.
The brokerage acknowledged the strengthening of the stability sheet and early operational enhancements. Moreover, it aligns with the view that the MFI cycle is popping, setting the stage for stronger enterprise momentum and decrease credit score prices in 2HFY26.
Brokerages elevate goal worth for RBL Financial institution after This autumn outcomes
Motilal Oswal will increase its EPS estimates by 12% every for FY26/FY27, as enterprise development is gaining traction and slippages are anticipated to normalize by 2QFY26. Motilal Oswal additionally estimates the C/I ratio to enhance to 61% by FY27. The agency estimates FY26E RoA/RoE at 1.2%/12.8%. Motilal Oswal upgrades RBL Financial institution from Impartial to Purchase with a goal worth of INR 220 (premised on 0.8x FY27E ABV).
At a horny FY27E P/ABV a number of of 0.65x, the brokerage views the risk-reward profile as compelling. Thus, it maintained its ‘purchase’ ranking with a revised goal worth of ₹232 (earlier goal: ₹231) at a really useful P/BV a number of of 0.8x.
The brokerage’s optimistic outlook on the inventory is underpinned by sub-par returns beneath CoE, necessitating a reduction to BV; gradual enchancment in RoAE and operational effectivity, coupled with present valuations, justifying a constructive advice; and early indicators of stability in asset high quality within the unsecured portfolio. Another washout quarter is anticipated.
“RBL Financial institution reported beat in earnings, with margins remaining broadly secure. Asset high quality ratios improved in the course of the quarter, with NNPA on the JLG enterprise being nil, following a 100% provision on this enterprise,” mentioned Motilal Oswal.
RBL Financial institution Q4FY25 outcomes
The financial institution, post-market hours on Friday (April 25), reported a standalone web revenue of ₹68.7 crore. In the identical interval final 12 months, the financial institution reported a web revenue of ₹353 crore, reflecting an 80.5% drop on a YoY foundation, impacted by increased credit score prices, which got here in at 3.4% vs. 2.0% in Q4FY24 and 5.3% in Q3FY25.
On a sequential foundation, the web revenue improved, rising from ₹33 crore posted within the December quarter. NII got here in at ₹1,560 crore (down 2.5% YoY/down 1.3% QoQ), in step with Centrum Broking estimates of ₹1,580 crore. PPoP stood at ₹880 crore, down 2.3% YoY/up 1.3% QoQ, owing to an uptick in NII, which was higher than the brokerage expectations of ₹810 crore.
RBL Financial institution has guided for 16–18% mortgage development in FY26, led by 25–30% development within the secured RA phase and 10–12% in wholesale. The brokerage expects NIMs might face stress in FY26, and OPEX development will stay managed.
Disclaimer: The views and proposals given on this article are these of particular person analysts. These don’t symbolize the views of Mint. We advise traders to examine with licensed consultants earlier than taking any funding choices.
