1. At a Glance
IDBI Bank delivered a 17% PAT jump in Q1 FY26, clocking ₹2,007 Cr in net profit with improving asset quality and consistent earnings growth. But with 94.7% held by promoters (LIC + GoI), is there any free float left to trade?
2. Introduction with Hook
Once the poster child of NPAs and public sector inefficiency, IDBI Bank is now flexing a ₹1 Lakh Cr+ market cap and 26% CAGR PAT. From walking dead to walking dividend, this bank has undergone a transformation that might just make even ICICI blink.
- Q1 FY26 Net Profit: ₹2,007 Cr
- FY25 PAT: ₹7,656 Cr (highest ever)
- Contingent Liabilities: ₹3.35 Lakh Cr — wait, what?
3. Business Model (WTF Do They Even Do?)
IDBI Bank is a full-service bank that earns from:
- Retail Banking: 55% share; home loans, savings, MSME lending.
- Corporate Banking: ~17% of biz; includes term lending.
- Treasury Operations: ~27%; SLR, G-Sec trading, forex.
- Others: Fees, third-party insurance, mutual funds.
Oh, and it still feels half-PSU, half-private. Because it is.
4. Financials Overview
| Metric | FY23 | FY24 | FY25 | TTM |
|---|---|---|---|---|
| Revenue (₹ Cr) | 20,592 | 26,446 | 28,917 | 29,274 |
| Net Profit (₹ Cr) | 3,728 | 5,814 | 7,656 | 7,941 |
| EPS (₹) | 3.45 | 5.38 | 7.10 | 7.36 |
| ROE % | 8% | 12% | 14% | 13.6% |
| Net NPA % | 0.44% | 0.39% | 0.34% | Improving |
🧠 From -49% ROE in FY19 to 14% in FY25. Someone fed this bank protein and ethics.
5. Valuation
- EPS (TTM): ₹7.36
- P/E: 13.2x
- Peers P/E: Private banks avg ~18–22x
Fair Value Range
- Bear Case: ₹7.36 × 11 = ₹81
- Bull Case: ₹7.36 × 18 = ₹133
→ FV Range: ₹81 – ₹133
At CMP ₹97, it’s chilling somewhere in the middle with a filter coffee.
6. What’s Cooking – News, Triggers, Drama
- Privatization Buzz: LIC + GoI stake = 94.72%.
- NPA Clean-up: Net NPA at all-time low.
- Q1 FY26 PAT: ₹2,007 Cr, up 17%.
- Retail Push: 55% of book now retail—granny-friendly strategy.
- IPO Rumors for LIC stake sale: Still unconfirmed, but juicy.
7. Balance Sheet
| Item | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity Capital | ₹10,752 Cr | ₹10,752 Cr | ₹10,752 Cr |
| Reserves | ₹35,567 Cr | ₹40,321 Cr | ₹50,868 Cr |
| Deposits | ₹2.55 L Cr | ₹2.77 L Cr | ₹3.09 L Cr |
| Borrowings | ₹12,638 Cr | ₹17,083 Cr | ₹19,932 Cr |
| Total Assets | ₹3.31 L Cr | ₹3.64 L Cr | ₹4.13 L Cr |
Debt is fine. But contingent liabilities of ₹3.35 L Cr = 🚨 Read the fine print.
8. Cash Flow – Sab Number Game Hai
| Year | CFO | CFI | CFF | Net |
|---|---|---|---|---|
| FY23 | ₹-2,701 Cr | ₹-283 Cr | ₹-3,569 Cr | ₹-6,554 Cr |
| FY24 | ₹-1,252 Cr | ₹-217 Cr | ₹-1,768 Cr | ₹-3,237 Cr |
| FY25 | ₹25,796 Cr | ₹-338 Cr | ₹-6,990 Cr | ₹18,467 Cr |
Massive bounce in FY25. Either treasury gains, or LIC just blessed it.
9. Ratios – Sexy or Stressy?
| Ratio | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROE | 8% | 12% | 14% |
| ROA | 1.2% | 1.6% | 2.0% |
| Net NPA | 0.44% | 0.39% | 0.34% |
| CAR | ~16.5% | ~17.0% | ~17.4% |
| Dividend Payout | 29% | 28% | 30% |
Verdict: Finally acting like a private bank… just with LIC’s blessings.
10. P&L Breakdown – Show Me the Money
| Year | Revenue | Interest | Expenses | Net Profit |
|---|---|---|---|---|
| FY23 | ₹20,592 Cr | ₹9,130 Cr | ₹10,232 Cr | ₹3,728 Cr |
| FY24 | ₹26,446 Cr | ₹12,226 Cr | ₹9,233 Cr | ₹5,814 Cr |
| FY25 | ₹28,917 Cr | ₹14,257 Cr | ₹8,594 Cr | ₹7,656 Cr |
Margins expanding. Other income (₹5,756 Cr) also deserves a standing ovation.
11. Peer Comparison
| Bank | CMP | P/E | ROE | Net Profit (₹ Cr) | CASA % | Net NPA % |
|---|---|---|---|---|---|---|
| HDFC Bank | ₹2,000 | 21.7 | 14.5% | ₹16,257 | 42.0% | 0.33% |
| ICICI Bank | ₹1,466 | 19.7 | 18.0% | ₹13,558 | 44.0% | 0.42% |
| Axis Bank | ₹1,099 | 12.2 | 16.3% | ₹6,244 | 47.0% | 0.35% |
| IDBI Bank | ₹97 | 13.2 | 13.6% | ₹7,656 | ~54.0% | 0.34% |
It’s punching above its weight now. Time to shed the PSU tag?
12. Miscellaneous – Shareholding, Promoters
| Category | Mar 2023 | Jun 2025 |
|---|---|---|
| Promoters (LIC + GoI) | 94.72% | 94.72% |
| Public | 4.63% | 4.59% |
| FIIs | 0.46% | 0.54% |
| DIIs | 0.18% | 0.15% |
🚨 Over 5.9 lakh retail shareholders chasing 5% float. Free float is basically a myth.
13. EduInvesting Verdict™
IDBI Bank is not the same beast it was in 2018. It’s gone from red tape to black ink—posting ₹7,900 Cr+ profits and a solid 14% ROE. The bad loan mess is (finally) behind. The operating profit, CASA base, and NPAs look like a private bank.
But—huge contingent liabilities, minimal free float, and unclear privatization timeline = don’t expect fireworks yet.
Still, if this bank gets fully privatized and re-rated… you’ll wish you had stocked up below ₹100.
Metadata
– Written by EduInvesting Team | 21 July 2025
– Tags: IDBI Bank, Q1 FY26, LIC Stake, Privatization, PSU Banks, Turnaround Stories
