Bandhan Bank Lowers FY27 ROA Outlook as Costs Rise, Shares Fall

Bandhan Bank’s share price dropped sharply on Wednesday, registering a 17.44 percent decline to ₹172.40 on the NSE. The plunge follows the bank’s decision to lower its FY27 return‑on‑assets (ROA) forecast, citing rising operating costs and a dip in net interest margin.

The lender cut its Q4 FY27 ROA guidance by 40 basis points, moving the target range to 1.2‑1.4 percent from the earlier 1.6‑1.8 percent. The downgrade is attributed to a 30‑basis‑point reduction in net interest margin and a further 10‑basis‑point drag from higher operating expenses.

Despite the market setback, the bank reported a strong first‑quarter profit of ₹502 crore, a 35 percent rise over the same period last year’s ₹372 crore. Net interest income increased 6 percent YoY to ₹2,921 crore, keeping the net interest margin at 6.2 percent. Asset quality metrics also improved, with gross NPA falling to 3.15 percent (down from 3.27 percent) and net NPA declining to 0.93 percent (down from 0.97 percent). Provisions shrank sharply to ₹683 crore from ₹1,147 crore a year ago, boosting earnings.

The broader market mirrored the bank’s weakness. The Sensex slid 690 points (‑0.89 percent) to 76,790, while the Nifty fell 188 points (‑0.80 percent) to 23,999. Banking stocks led the downturn, with the Nifty Bank index down 1.30 percent at 57,081.