IDFC First Bank Limited

Here is my Projected Financials of IDFC First till FY 29 based on management guidance of few metrics in their Guidance 2.0 metrics and few of my own hypothesis

1. Loans to grow annually at ~ 22% till FY 29
2. Deposit to grow by 25% till FY 27 and 24% thereafter
3. Borrowings to be keep reducing by 10% YOY
4. NII to grow at CAGR of ~ 24% annually till FY 27 and then slow to ~ 20% ( have assumed drop in yield to be 40 bps in 5 years due to estimated repo rate drop ( almost 40% the book is not repo rate rate driven ) and assumed Cost of deposit to drop by almost 100 bps over next 5 years due to pay off of legacy bonds , reduction in repo rate )
5. Fee Income to grow by 22-24% annually till FY 29 ( Assumed growth here to tapper from 35% -40% historically as many fees are waived off )
6. Opex increase assumed to be 20% in FY 25 and 19% thereafter ; Cost to Income ratio to come down by 67% till FY 27 and 63% by FY 29
7. Credit Cost to be 1.85% in FY 25 , 1.65% in FY 26 and 1.50% from FY 27 onwards
8. ROA is coming to be 1.5% in FY 27 and 1.8% in FY 29
9. PAT for FY 29 is coming at ~ 11500 Cr ;
10. Have assumed no further equity dilution

Kindly critically examine these numbers and assumptions as to far these looks reasonable

Management has guided for 12-13k Cr of PAT in FY 29 with 1.8-2.0 ROA and 17-18% ROE and 7 lacs cr of Balance sheet size

Disc : Invested