The cautious outlook prompted a domestic brokerage to downgrade the stock to 'Hold' from 'Buy', while retaining its target price of Rs 225. The brokerage also cut its FY27 and FY28 earnings estimates by 14% and 6%, respectively, and now expects the bank to deliver RoA of 1% in FY27 and 1.4% in FY28.
For the quarter ended 30 June 2026, the bank reported a standalone net profit of Rs 501.67 crore, up 34.9% from Rs 371.96 crore a year earlier but down 6.1% from Rs 534.14 crore in the previous quarter.
Net interest income rose 5.9% YoY to Rs 2,921 crore, while net revenue increased 1.2% YoY to Rs 3,524 crore. Net interest margin (NIM) stood at 6.2% in Q1 FY27, down 16 basis points YoY but up 2 basis points sequentially.
Total income rose 0.5% YoY and 0.6% QoQ to Rs 6,234.38 crore.
Operating profit before provisions and contingencies fell 18.6% YoY and 5.8% QoQ to Rs 1,358.10 crore.
Profit before tax stood at Rs 675.52 crore, up 29.5% YoY but down 11.6% QoQ.
The bank's provisions and contingencies declined 40.5% YoY to Rs 682.59 crore, although they were marginally higher than the Rs 677.01 crore reported in the March quarter.
Gross advances increased 16.4% YoY to Rs 1,55,555 crore, while deposits rose 6.6% YoY to Rs 1,64,886 crore as of 30 June 2026. Retail deposits, comprising CASA and retail term deposits, accounted for 74% of total deposits, while secured advances grew 27% YoY and constituted nearly 57% of the loan book.
Asset quality improved during the quarter. Gross NPAs declined to Rs 4,880.95 crore, with the gross NPA ratio improving to 3.15% from 3.27% in the previous quarter and 4.96% a year ago. Net NPAs stood at Rs 1,411.63 crore, while the net NPA ratio eased to 0.93% from 0.97% in Q4 FY26 and 1.36% in Q1 FY26. The provision coverage ratio, including technical write-offs, stood at 85.9%, while collection efficiency for Emerging Entrepreneurs Business (EEB) loans remained at 98.5%.
Commenting on the results, managing director and CEO Partha Pratim Sengupta said the bank remains focused on customer-centric and digitally enabled growth by strengthening its distribution network, expanding product offerings, and leveraging data-driven insights to deliver sustainable long-term growth.
Bandhan Bank started operations as a universal bank on 23 August 2015. It currently operates nearly 6,400 banking outlets across 35 of India's 36 states and union territories and serves around 3.2 crore customers.
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