IDFC ltd:-Buy/sell: multibagger

Scripscan:Infrastructure Development Finance Company Ltd

BSE code:532659

cmp:109

Story:The performance for Q1FY12 was, as expected, down. This giant infra financing company posted a consolidated net profit of Rs.314 crore, down 6% on a YoY and this was despite a 24% rise in consolidated income at Rs.1351 crore. Operating costs were down 9% and that helped post a higher EBIDTA at Rs.1207 crore, up 29%. The fall in net profit was on account of a 55% surge in interest outgo and a 25% rise in tax. Net Interest income was at Rs.483 crore, which is a YoY increase of 43%. On the other hand, Non Interest Income decreased by 59% at Rs.110 crore.Revenue from the infra segment rose 30% and so did its EBIT, which rose 4%. But revenue from asset management, investment banking and institutional broking fell 10% and so did its EBIT, which was down 17%. CAR for the quarter was up at 24.01% from 19.02% in Q1FY11. Gross NPA is down marginally from 0.27% to 0.20% and net NPA was also down from 0.15% to 0.10%. Its net Loan book increased by 30% on a YoY at Rs.37,527 crore. At the end of the current Q1, its exposure stands at Rs.61.669 crore. Post the recent interest rate hike by RBI, things are indeed looking slightly tough for IDFC. In Q1 itself it has been facing a crunch on the earnings due to the higher interest outgo and it is only expected to go up in Q2.A good hold at present prices.

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