Jefferies maintains buy on Federal Bank, target price Rs 120

Jefferies has maintained buy rating on Federal Bank in the long term with a target price of Rs 120. Shares of Federal Bank ended up 0.85% at Rs 94.60 on Tuesday while the BSE Sensex closed 205.10 points (0.49%) down at 41,323.81.

Company Financials

For the quarter ended 31-12-2019, the company has reported consolidated interest income of Rs 2786.01 crore. The bank has reported net profit after tax of Rs 451.72 crore in the latest quarter.

Investment Rationale


The tough macro made its presence felt in the bank’s third quarter – loan growth was softer and NIM disappointed – resulting in core PPOP growing at a modest 4.0% year-onyear, said Jefferies. New NPL formation, at 2.2%, was in line with two chunky slippages (Dewan & Reliance Home Finance) from an already earmarked stressed book, said Jefferies.