RBL Bank soars 5%, nears 52-week high; what's driving private sector bank?

The average trading volumes at the RBL Bank counter more-than-doubled with a combined 34.6 million shares representing 5.7% of total equity changing hands on the NSE and BSE till 10:37 AM.

RBL Bank share price today

 

Shares of RBL Bank rallied 5 per cent to ₹263.70 on the BSE in Friday’s intra-day trade amid heavy volumes ahead of board meeting today to consider fund raising plan. The stock price of the private sector lender was quoting close to its 52-week high of ₹272.90 touched on July 18, 2025.

 

The average trading volumes at the counter more-than-doubled with a combined 34.6 million equity shares representing 5.7 per cent of total equity of RBL Bank changing hands on the NSE and BSE till 10:37 AM.

 

What's driving private sector bank?

 

At the 81st Annual General Meeting held on August 7, 2024, the shareholders of RBL Bank granted enabling approvals by way of special resolution for raising of funds by way of a Qualified Institutions Placement (QIP) by means of issuance of equity shares for an amount upto ₹3,500 crore, in one or more tranches and for issue of debt securities, in one or more tranches, on private placement basis, upto an amount of ₹3,000 crore (Private Placement). 

 

 

RBL Bank said the approval granted for QIP was valid for a period of 365 days from the date of passing of such Special Resolution and the approval granted for Private Placement of debt securities was valid for a period of one year from the date of passing of such Special Resolution, the validity of these have expired. The Bank had not raised any funds under the authority of the aforesaid resolution(s).

 

Considering the above and to facilitate fresh enabling approvals to be in place for the Bank, a meeting of the board of directors of RBL Bank is scheduled to be held on Friday i.e. on August 29, 2025 to inter-alia consider the fund raising proposals by way of QIP and issue of debt securities. 

 

InCred Equities view on RBL Bank

 

RBL Bank reported profit after tax of ₹200 crore in June 2025 quarter (Q1FY26). Strong treasury gains drove the beat while the core performance was weak. Margin declined by ~40bp quarter-on-quarter (QoQ) to 4.5 per cent owing to the impact of repo rate cut, product mix shift towards secured loans, and elevated slippage. Management stated that margin should gradually improve here on in FY26F.

 

The loan book grew by 9 per cent year-on-year (YoY) and 2 per cent QoQ, led by secured retail loans (24 per cent YoY; 2 per cent QoQ) and wholesale loans (15 per cent YoY; 2 per cent QoQ) while unsecured loans continued to decline (down 10 per cent YoY; 2 per cent QoQ). The bank retained its guidance of mid- to high-teen growth in FY26F, mainly led by secured retail loans (early- to mid-twenties) and wholesale book (mid-teen) while unsecured loans to grow in high single-digit to low teens in FY26F. 

 

Moderating micro finance institution (MFI) SMA book is comforting and improves visibility of ~200 bp credit costs for FY26F. With a CET-1 ratio of 14.1 per cent, the bank is unlikely to be in a hurry to raise capital in the near- to medium-term. 

 

InCred Equities expect RoA to improve to 0.9 per cent/1 per cent in FY27F/28F, respectively, from 0.5 per cent in FY25. RoE to improve to ~9/11 per cent in FY27F/28F, respectively, from ~5 per cent in FY25. The brokerage firm maintains ADD rating on the stock with a higher target price of ₹290 (₹260 earlier). Downside risks are lower-than-expected margin/loan growth, worsening asset quality, and any capital raising in the near term.