IDBI - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.9

🧾 Core Financial Analysis

📈 Profitability & Growth

PAT Qtr: ₹2,019 Cr vs ₹2,087 Cr — slightly down QoQ, but 16.4% YoY growth is solid.

EPS: ₹7.36 — decent for a ₹93 stock.

ROE (13.6%) & ROCE (6.78%) — ROE is healthy, though ROCE is modest due to capital-heavy banking operations.

💰 Cash Flow & Debt

Debt-to-Equity: 5.35 — high, but typical for banks due to deposit-based funding.

Dividend Yield: 2.26% — attractive for income-focused investors.

Cash Flow: Likely stable, supported by improving asset quality and profitability.

📊 Valuation Metrics

Metric Value Insight

P/E Ratio 12.6 Fairly valued vs industry PE — reasonable entry point

P/B Ratio ~1.62 Attractive given improving fundamentals

PEG Ratio 0.28 Very undervalued relative to growth — strong signal

Intrinsic Value Estimated ~₹105–₹115 Based on earnings and sector benchmarks

🏦 Business Model & Competitive Advantage

Sector: Banking — IDBI Bank is a mid-sized PSU bank undergoing transformation.

Model: Retail and corporate banking with improving asset quality and operational efficiency.

Moat: Government backing, potential strategic stake sale, and turnaround story.

Growth Drivers: Privatization prospects, NPA reduction, and digital banking expansion.

Risks: Legacy NPAs, competition from private banks, and regulatory overhang.

📉 Technical & Sentiment Indicators

RSI: 40.2 — mildly oversold, potential for rebound.

MACD: -0.76 — weak momentum.

DMA 50 & 200: Price near DMA50 and above DMA200 — neutral to mildly bullish.

Volume: Below average — subdued interest, but not alarming.

💡 Investment Guidance

📌 Entry Zone (If Undervalued)

₹85–₹90 — ideal accumulation zone near DMA200 and below intrinsic value.

Strong support around ₹80–₹85.

📈 Long-Term Holding View

Promising turnaround candidate.

Improving profitability, low valuation, and strategic interest make it a value play.

Suitable for investors with moderate risk appetite and a 2–4 year horizon.

Monitor asset quality and privatization developments for upside triggers.

Would you like a turnaround stock comparison with Bank of Maharashtra or Indian Overseas Bank to explore similar PSU opportunities?

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