Mumbai–Bandhan Bank shares fell more than 15 percent Wednesday after the lender lowered its return-on-assets outlook, overshadowing a stronger-than-expected quarterly profit.
The Kolkata-based bank now expects its return on assets to average between 1.2 percent and 1.4 percent by the end of fiscal 2027, down 40 basis points from its previous forecast of 1.6 percent to 1.8 percent.
The bank attributed the weaker outlook to narrower net interest margins and higher operating expenses.
Bandhan Bank shares fell as much as 15.27 percent, or Rs 31.88, to Rs 176.95 during intraday trading.
“Our medium-term strategic objective remains unchanged, and we continue to work towards achieving the guided level of RoA (return on assets). The prevailing external environment may influence the pace at which we get there,” Managing Director and Chief Executive Officer Partha Pratim Sengupta said during a post-earnings conference call with analysts.
The bank’s return on assets stood at 1 percent at the end of June, up 20 basis points from a year earlier but down 11 basis points sequentially.
Sengupta said higher funding costs stemming from external uncertainties and increased technology-related expenses contributed to the revised guidance.
Bandhan Bank reported a 35 percent year-over-year increase in net profit to Rs 502 crore for the first quarter of fiscal 2027, compared with Rs 372 crore a year earlier.
Net interest income rose 5.9 percent to Rs 2,921 crore, while total net income increased 1.2 percent to Rs 3,524 crore.
Gross advances climbed 16.4 percent from a year earlier to Rs 1,55,555 crore as of June 2026. The retail loan portfolio, excluding housing, grew 45 percent, while wholesale banking increased 38 percent and the housing loan book expanded 6 percent.
The lender said its gross nonperforming asset ratio improved by 182 basis points from a year earlier, while its net nonperforming asset ratio improved by 43 basis points.
Bandhan Bank reiterated its focus on customer-centered, digitally enabled growth through an expanded distribution network and broader product offerings. (Source: IANS)
