Bandhan Bank shares plunge nearly 17% after lender cuts RoA guidance

The lender lowered its FY27 return on assets guidance after June-quarter earnings, overshadowing a 35 per cent rise in net profit and weighing on investor sentiment

Shares of Kolkata-based Bandhan Bank plunged on Wednesday after the lender lowered its return on assets (RoA) guidance by 40 basis points (bps) to 1.2-1.4 per cent, following its earnings for the first quarter of 2026-27 (Q1FY27) announced after market hours on Tuesday. The stock ended the day nearly 17 per cent lower at ₹173.40 on the BSE. 

 

The bank’s management cut its Q4FY27 exit-RoA expectation by 40 bps to 1.2-1.4 per cent, comprising 30 bps from weaker margins and 10 bps from elevated operating costs.  

 

Its net profit at ₹502 crore, up 35 per cent year-on-year (Y-o-Y), missed estimates due to weak loan growth of 1 per cent sequentially and lower treasury gains. The bank’s advances were weighed down by sequential contraction in the microfinance book. Management is eyeing 14 per cent Y-o-Y credit growth in FY27. 

 

 

While net interest margin (NIM) was in line at 6.2 per cent, cost-to-income rose 188 bps sequentially to 61.5 per cent, driving a 6 per cent sequential pre-provisioning operating profit fall. 

 

Suresh Ganapathy, managing director & head of financial services research, Macquarie Capital, said: “Constrained margins and delayed operating leverage leave the near-term earnings outlook cautious (for Bandhan Bank). RoA remains subpar, and the path toward improvement remains clouded”.