Strong Q1, NIM guidance cut signals margin pressure ahead

Audited PAT ₹3,302.6 Cr (+87.2% YoY), 7.8% higher than call disclosure

₹6.72L→₹7.98L Cr confirms 18.64%, outperformed but guidance maintained

₹8.34L→₹9.58L Cr confirms 14.90%, guidance maintained

Delivered result confirms asset quality improvement

NIM declining 3 bps QoQ; FY27 guide cut from prior 2.70–2.75%

Q1 ROA >1% on audited PAT aligns with guidance, track record maintained

Prior: 2.70–2.75% FY27. Now: 2.55–2.60%. Q1 NIM fell 3 bps QoQ to 2.52%, signalling rate cycle and competition.

Slowed to 3% YoY (from typical double digits). Management imposed guardrails on low-ticket/non-salaried loans due to industry stress; de-risking bias.

Q1: 18.64% actual; FY27 guide: 15–16%. Implicit signal growth expected to normalise; no upgrade despite outperformance.

Q1: 14.90% vs guide 13–14%. Maintained rather than raised; management cautious on deposit stickiness as savings patterns shift.

Q1: 46% (strong). FY27 guide: 48–49% (i.e., expect cost pressures 200–300 bps vs Q1).

SMA (₹5Cr+) down to ₹4,090 Cr (0.52% of standard book) from ₹7,000+ Cr Jun'25. Fresh slippages ₹1,800 Cr vs ₹2,100 Cr Jun'25. ECLGS: ₹6,000 Cr sanctioned, ₹4,600 Cr disbursed; expect ₹8,000 Cr by scheme end. Zonal collections strong; chemical/ceramics/export sectors monitored closely.

FCNRB target $1.2B by Sept 30; already $200M garnered. Leverage product: up to 9x approved, rolled out. Rates: 3Y 6.25%, 4Y 6.30%, 5Y 6.50%. Spread ~50 bps on 5Y after RBI hedging. 250+ NRI/AD branches across 13 FGMOs mobilising globally. Expects mix of direct + leverage.

If repo rises, 60% of book external benchmark yields improve NIMs. On loans, trade-off: rates up = investment book stressed. Strategy: grow RAM, corporates, mid-corp, TREDs, co-lending, intl diversified to mitigate single-sector/geography risk.

Gift City: key lending strategy, strong book, domestic + intl corporate pipeline. Gold loans: ₹57K Cr, yield 9.10%, NPA <₹100 Cr, growing 52% YoY. Merger: no comment; only for govt/RBI. FCNRB $1.2B + OFCB/MTN $2B + ECB ₹~1B = $4.2B by Dec 31.

3L+ NRI/PIO/OIC customers, strong franchise. Majority of $200M FCNRB so far direct; expect some leverage from HNI discussions. Spread/rates moving target; won't quantify now.

Personal: guardrails on low-ticket, non-salaried loans (industry risk). Focus on service sector with salary mandate. De-escalation intentional for risk control; monitoring monsoon/West Asia stress. Credit cards: revamped systems Q4; target 3L by FY27 end.

ROA: 1%+ QoQ consistent (maintained from Mar guide). NIM: 2.55–2.60% FY27 (down from prior 2.70–2.75%). CIR: 46% Q1; expect 48–49% full year. Yields under pressure; cost of deposits coming down; strategy: grow MCLR, mid-corp via ECCBs (₹25–250 Cr), LC/BG, LC/BG commissions.

CASA/retail term deposit mix shift: structural. Bulk deposits ₹3Cr+ now higher (campaign in 3–25Cr band for better rates). Credit growth 18.64% requires resources. Cost reduction from CASA mix offset by bulk rates; optimize yield. ATM: rationalized loss-making CAPEX models; cost optimization. MF: ₹16–17K Cr AUM; grow further before IPO; no near-term plans.

Q1 actual 18.64%, ahead of target; reaffirmation signals normalisation expected. Implies sequential deceleration in Q2–Q4.

Q1 actual 14.90% in range; guidance unchanged despite beat. Deposit mix shifting (CASA down 3%); bulk deposit reliance up.

Q1 at 2.52%; 15–20 bps cut from prior guide. Rate cycle, West Asia headwinds, competition cited. Depositcost moderation and yield-on-advances strategies to offset.

Q1 exceptionally good; expect cost inflation (digital, HR, cybersecurity capex ramping). CIR guidance implies 200–300 bps degradation from Q1.

NIM guidance cut 15–20 bps (2.70–2.75% to 2.55–2.60%); Q1 NIM 2.52% trending down. Deposit costs not falling fast enough; yield on advances under pressure.

Direct impact on chemicals, ceramics, import/export (esp. oil/gas); supply chain crisis increasing working capital cycles; some SMA noted in these sectors.

Personal loans intentionally slowed to 3% YoY (from historical double-digit growth) due to industry stress. Low-ticket and non-salaried segments restricted; guardrails in place.

CASA ratio down 3%; retail term deposits down 3%; structural shift in India's savings (equity, MF, wealth products compete). Bulk deposit reliance rising to fund 18.64% advances growth.

Monsoon uneven progress flagged by MD; impact on food prices and agri-sector borrowers; potential stress on MSME/agri loan repayment.