Federal Bank posted a strong growth in profitability and core earnings, driving investor interest in the counter. The stock of this private sector lender hit the day’s peak of ₹351, up 7.35 per cent against the last close of ₹326.95 apiece.
As of 3.03 PM, Federal Bank share price traded 6.5 per cent higher at ₹348.40 apiece compared with a 1.20 per cent increase in BSE barometer Sensex to 78,121 levels.
Federal Bank shares have also outperformed the benchmark over multiple time frames. According to BSE data, Federal Bank has risen 31 per cent on a year-to-date basis as against a 8 per cent fall in Sensex. In the last one year, the stock is up 64 per cent and in two years, it has risen 78 per cent.
Federal Bank Q1 Results
During the quarter under review, Federal Bank’s net profit came in at ₹1,176.93 crore, up 36.57 per cent year-on-year (Y-o-Y), driven by a strong growth of 26 per cent Y-o-Y in the net interest income (NII) to ₹2,945.89 crore.
Net interest margin (NIM) expanded by 39 bps Y-o-Y to 3.33 per cent, as cost of funds moderated.
Asset quality was at its historic best, the company said in a press release. Net NPA was at 0.18 per cent, a decadal low for the and gross NPA improved to 1.52 per cent. Fresh slippages fell 37.79 per cent Y-o-Y to ₹409.48 crore.
The Bank’s funding profile continued to improve, with CASA growing 18.26 per cent Y-o-Y against total deposit growth of 11.37 per cent.
Federal Bank share price outlook
Commenting on the technical outlook for Federal Bank, Harish Jujarey of Prithvi Finmart said that after consolidating near its 20 day moving average over the past few sessions, the stock has gave a decisive breakout, signaling a fresh leg of upward momentum.
“The broader trend remains firmly positive, with the stock continuing to trade within an upward sloping channel. As per the channel formation, the next resistance is placed around 380. On the downside, the recent breakout zone of 336-338 is expected to act as immediate support,” he said.
Any corrective decline towards this zone can be considered a buying opportunity for short to medium term, according to the expert. He advised a stop-loss can below 324, for upside targets of 362 and 380.
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