IDFC First Bank surged 10% to a high of Rs 41.30 in intraday trade on Monday after the private sector bank reported strong earnings for the first quarter of FY23.

The bank posted a standalone record profit of Rs 474.33 crore in the quarter ended June 2022, compared with a net loss of Rs 630 crore in the corresponding quarter a year ago. Net interest income rose 26% YoY to Rs 2,751.1 crore, and net interest margin rose 39 basis points YoY to 5.89%.

The stock was up 9.2% at Rs 41 on the BSE at 10.20 am on a trading volume of around 66.09 lakh shares, compared with a two-week daily average of around 19.10 lakh shares. Meanwhile, the S&P BSE Sensex rose 0.6% to 57,933 and the BSE Bankex index rose 0.3%.

The stock has surged nearly 43% from a low of Rs 28.95 in the past seven trading weeks. In July alone, the stock rose 19.4%, well above the BSE benchmark, which rose 8.6%.

Furthermore, the bank reported that deposits rose 21% year-on-year to Rs 1,02,868 crore in the quarter.

Asset quality at the bank level (GNPA and NNPA) also improved by 125 basis points and 102 basis points year-on-year, or 3.36% and 1.30%, respectively.

According to a press release issued by IDFC First Bank, V Vaidyanathan, MD and CEO, said: “We have laid a solid foundation for the bank on which we can easily grow our loan book, deposits, and profit in a stable manner.

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We posted a record profit after tax of Rs 474 crore in Q1FY23. Our return on assets is close to 1%, and we expect it to rise from here. We are pleased that our gross retail NPA and net NPA have recovered to 2.1% and 0.9%, respectively, even after the pandemic, which is our long-term experience. More importantly, he added that retail asset quality is returning to normal faster than our earlier March 2023 guidance.