IDFC First Bank jumps 4%, beats Nifty in best session since fraud incident

Shares of IDFC First Bank rose over 4 per cent on Thursday, the highest gains for the stock since the lender reported a ₹590 crore fraud at one of its branches in Chandigarh. 

 

The company's stock rose as much as 4.07 per cent during the day to ₹73.08 per share, the biggest intraday gain since February 3 this year. The stock pared gains to trade 3.7 per cent higher at ₹72.8 apiece, compared to a 0.05 per cent advance in Nifty 50 as of 2:59 PM. 

 

Shares of IDFC First Bank are down 15 per cent since the highest level this year and 2.8 currently trade at 9.2 times the average 30-day trading volume, according to Bloomberg. The counter has fallen 14 per cent this year, compared to a 2.3 per cent decline in the benchmark Nifty 50. IDFC First has a total market capitalisation of ₹62,774.10 crore. 

IDFC First Bank response after Chandigarh branch fraud 

Earlier this week, IDFC First Bank disclosed a fraud of ₹590 crore involving government deposits at one of its branches in Chandigarh. The discrepancies came to notice after one of the state government departments sought to close its bank account with IDFC First Bank and transfer the funds to another bank. However, the amount mentioned by the department did not match the balance in the account.

 

IDFC First Bank said it has refunded 100 per cent of the principal and interest amount claimed by the relevant departments of the Haryana government, even as investigations into the matter remain ongoing. In a statement, the bank said it upholds the highest standards of governance and positions itself as a customer-first institution, with transparent product policies and disclosures.

 

The lender said that in keeping with its stated principles, it chose to act proactively and honour the full claim despite the investigation not being concluded. The bank added that the decision reflects its commitment to prioritising customers and stakeholders, particularly in situations involving differences of opinion.

 

However, the lender saw its target price and earnings estimates cut by brokerages after the fraud incident. The aggregate amount under reconciliation across the identified accounts is approximately ₹590 crore. This is more than the ₹503 crore net profit it reported for the October-December quarter of 2025-26 (Q3-FY26).

 

Emkay Global expects this to weigh on near-term current account savings account growth and delay margin recovery. The brokerage has cut its FY26, FY27 and FY28 earnings estimates by 30 per cent, 13 per cent and 9 per cent, respectively. The revisions factor in fraud-related provisions in FY26 and second-order business and margin impact over the following two years.

 

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