IDBI Bank Q4 FY25: Profit up 26%, dividend proposed

Why loan growth versus deposits is in focus

Banks entered the March quarter with close attention on the gap between credit growth and deposit mobilisation. When advances expand faster than deposits, funding costs can rise, and net interest margins can come under pressure. That theme showed up across several lenders cited in the data set, including Kotak Mahindra Bank and IDBI Bank. Investors typically track this gap because it can influence pricing of deposits, the mix of wholesale funding, and the sustainability of net interest income.

Kotak Mahindra Bank: credit growth outpaces deposits

Kotak Mahindra Bank reported credit growth that outpaced deposit expansion. The bank registered a 16.2% rise in advances to Rs 495,000 crore from Rs 426,000 crore in the fourth quarter of the preceding fiscal. The data shared does not include Kotak’s deposit figure, but the headline notes that credit grew faster than deposits. For lenders, this usually means the bank may need to raise deposits more aggressively or rely on costlier sources of funds to support growth.

IDBI Bank Q4 FY25: profit rises, NII declines

IDBI Bank’s March 2025 quarter update showed a clear split between bottom-line growth and core income. Net profit for Q4 FY25 rose 26% year-on-year to Rs 2,051.2 crore, compared with Rs 1,628 crore. However, net interest income (NII) declined 10.8% to Rs 3,290.3 crore from Rs 3,688 crore in the year-ago period.

The data also reports that operating profit stood at Rs 3,194.81 crore in Q4 FY25, up 46.88% year-on-year. NIM reduced by 91 basis points to 4% in Q4 FY25 from 4.91% in Q4 FY24. These numbers point to margin pressure even as overall profitability improved.

Asset quality improved in the March quarter

Alongside earnings, asset quality metrics moved in a favourable direction in the March 2025 quarter. Gross NPAs were reported at 2.98% versus 3.57% on a quarter-on-quarter basis. Net NPAs slipped to 0.15% versus 0.18% QoQ.

In absolute terms, gross NPAs stood at Rs 6,695.2 crore in Q4 compared with Rs 7,634.8 crore QoQ. Net NPAs came at Rs 337.3 crore versus Rs 365.5 crore QoQ. The combination of lower ratios and lower absolute NPAs is typically read as reduced stress and improved recoveries or write-offs.

Dividend proposal and profitability for FY25

For the full year FY25, IDBI Bank reported consolidated net profit of Rs 7,515.17 crore, up 33.38% year-on-year. Consolidated revenue increased 12.61% to Rs 33,826.02 crore in FY25 over FY24.

The board recommended a dividend of Rs 2.10 per equity share for the financial year ended 31 March 2025, subject to shareholder approval at the ensuing AGM. In the dataset, the dividend is also described as a 21% proposal, again linked to AGM approval.

Stock reaction: gains after Q4, mixed trading signals next day

Market reaction to the Q4 FY25 numbers was positive in the immediate session referenced. Shares gained over 4% after the lender said March-quarter net profit rose by 26%. The stock gained 4.33% to a high of Rs 83.95 on the BSE, and the bank’s market capitalisation was reported at Rs 89,223 crore.

A separate trading update for April 29, 2025 noted that IDBI Bank shares opened at Rs 84.45, up from a previous close of Rs 82.72. At 11:53 AM, the share price was Rs 82.79, up 0.08% on the NSE. The mix of these prints suggests early optimism after results, followed by intraday consolidation.

Q3 FY26: shares fell despite profit rise as NII dropped

The dataset also includes a later quarter where the market response turned negative. For the quarter ended December 31, 2025, IDBI Bank reported net profit of Rs 1,935.5 crore, up 1.4% from Rs 1,908.3 crore a year earlier. Despite the profit increase, shares fell nearly 6%, with the decline attributed to a sharp contraction in core income.

Net interest income fell 24.1% year-on-year to Rs 3,209.4 crore. Interest earned declined to Rs 7,073.6 crore from Rs 7,815.6 crore, while interest expended rose to Rs 3,864.1 crore from Rs 3,587.4 crore. Sequentially, NII slipped 2.3%.

Other income and provisions cushioned earnings

In the December 2025 quarter, other income rose 61.3% to Rs 1,208.9 crore from Rs 749.4 crore, helping offset weaker NII. Operating expenses increased 15% to Rs 2,501 crore, driven mainly by higher employee costs.

Profit was also supported by a provision write-back of Rs 541.6 crore, compared to an expense in the prior year, and the dataset notes reversals of provisions towards NPAs as well. On the balance sheet, deposits grew 9% year-on-year to Rs 308,000 crore, while advances rose 15.5% to Rs 239,000 crore. Gross NPAs improved to 2.57% from 3.57% a year ago, while NIM fell sharply to 3.52% from 5.17%.

Key numbers at a glance

What the data implies for investors tracking banks

Across the snippets, the common thread is that faster loan growth can coincide with deposit competition and margin pressure. IDBI Bank’s March 2025 quarter showed that profits can rise even when NII and NIM soften, helped by operating leverage, asset-quality improvements, and provisioning outcomes. The December 2025 quarter illustrates the market’s tendency to penalise sharp drops in core NII even if reported profit is supported by other income and provision write-backs.

Conclusion

IDBI Bank’s Q4 FY25 performance combined higher profit and improving asset quality with weaker NII and lower margins, alongside a proposed dividend for FY25 subject to AGM approval. Subsequent quarter data in the dataset shows why investors continued to focus on core income trends and funding costs. The next formal checkpoints for markets, based on the provided information, are shareholder approval of the dividend at the AGM and upcoming quarterly disclosures that clarify the trajectory of NII, NIM, and deposit growth.