Bandhan Bank disappoints Street in Q1; analysts 'positive' on the stock

Quite a few analysts are maintaining a 'buy' rating on the bank but they have downgraded earnings and RoA (return on assets) expectations and target prices

Bandhan Bank has declared disappointing results for the first quarter of the 2023-24 financial year (Q1FY24). While the market has been braced for known issues around microfinance exposures in West Bengal and Assam, there is higher stress in the portfolio. This means higher credit costs and poorer asset quality, leading to target downgrades by analysts.

The Q1FY24 net interest income (NII) of Rs. 2,490 crore was down 0.9 per cent year-on-year (YoY) and up 0.8 per cent quarter-on-quarter (QoQ). The net interest margin (NIM) was stable at 7.3 per cent (down 70 basis points or bps YoY). The bank guidance