Federal Bank share price target: Systematix upgrades stock to 'Buy' post Q3 earnings
Brokerage firm Systematix Institutional Equities has upgraded the stock to a 'Buy' rating from its earlier 'Hold' stance.
- Jan 17, 2026,
- Updated Jan 17, 2026 11:21 AM IST
Federal Bank Ltd shares witnessed an upward momentum on the exchanges on Friday, reflecting street optimism following its set of numbers for the third quarter. Shares of Federal Bank rose 9.50% to settle at Rs 270.35 apiece on the BSE after the announcement of its December quarter results.
The private lender posted a net profit of Rs 1,041 crore for the quarter ended December 31, 2025, registering a growth of 9% compared to Rs 955 crore in the same quarter last year.
Followingits earnings, brokerage firm Systematix Institutional Equities has upgraded the stock to a 'Buy' rating from its earlier 'Hold' stance.
Systematix highlighted that the bank's sequential improvement was driven by improved margins and lower provisions. The Net Interest Margins (NIMs) for the quarter stood at 3.18%, expanding by 12 basis points (bps) quarter-on-quarter (QoQ) and 7 bps year-on-year (YoY).
This expansion came despite a 12 bps decline in yield on advances, as the bank successfully managed its liability costs.
Gross advances grew by 4.5% sequentially and 10.9% YoY. The brokerage pointed out that this improvement was fueled by healthy traction in gold loans, which rose roughly 8.9% QoQ to Rs 35,220 crore, and the CV/CE segment, which grew about 5.8% QoQ, Systematix said.
Asset quality metrics showed continued improvement, with the annualised gross slippage ratio falling to 0.70%, down 25 bps sequentially.
Systematix remains optimistic about the lender’s growth trajectory. The management has guided for advances to grow at around 16% in FY27, with momentum expected to be sustained in chosen mid-yielding segments.
Valuing the bank at 1.5x its FY28E book value per share of Rs 195 and assigning Rs 17.5 per share to its subsidiaries, Systematix has also revised its estimates to factor in better growth and margin scope, raising the target price to Rs 310 on Federal Bank stock from Rs 275 previously, implying a potential upside of 15% from current levels.
Federal Bank Ltd shares witnessed an upward momentum on the exchanges on Friday, reflecting street optimism following its set of numbers for the third quarter. Shares of Federal Bank rose 9.50% to settle at Rs 270.35 apiece on the BSE after the announcement of its December quarter results.
The private lender posted a net profit of Rs 1,041 crore for the quarter ended December 31, 2025, registering a growth of 9% compared to Rs 955 crore in the same quarter last year.
Followingits earnings, brokerage firm Systematix Institutional Equities has upgraded the stock to a 'Buy' rating from its earlier 'Hold' stance.
Systematix highlighted that the bank's sequential improvement was driven by improved margins and lower provisions. The Net Interest Margins (NIMs) for the quarter stood at 3.18%, expanding by 12 basis points (bps) quarter-on-quarter (QoQ) and 7 bps year-on-year (YoY).
This expansion came despite a 12 bps decline in yield on advances, as the bank successfully managed its liability costs.
Gross advances grew by 4.5% sequentially and 10.9% YoY. The brokerage pointed out that this improvement was fueled by healthy traction in gold loans, which rose roughly 8.9% QoQ to Rs 35,220 crore, and the CV/CE segment, which grew about 5.8% QoQ, Systematix said.
Asset quality metrics showed continued improvement, with the annualised gross slippage ratio falling to 0.70%, down 25 bps sequentially.
Systematix remains optimistic about the lender’s growth trajectory. The management has guided for advances to grow at around 16% in FY27, with momentum expected to be sustained in chosen mid-yielding segments.
Valuing the bank at 1.5x its FY28E book value per share of Rs 195 and assigning Rs 17.5 per share to its subsidiaries, Systematix has also revised its estimates to factor in better growth and margin scope, raising the target price to Rs 310 on Federal Bank stock from Rs 275 previously, implying a potential upside of 15% from current levels.