Federal Bank Shares : The banking stock Federal Bank, included in Rekha Jhunjhunwala’s portfolio, has seen a strong surge in its share price. After an initial dip, the shares recovered to hit a record high. The previous record high was ₹216.90, and today, intraday on the BSE, the shares jumped 2.28% to ₹217.95. However, they initially fell 0.73% to ₹211.55 amid a selling spree at the start of trading. The shares got support from a ₹6,000 crore fundraising plan that has already received board approval, though it still awaits shareholder and regulatory clearance. As for Rekha Jhunjhunwala, she holds 34,530,060 shares, equivalent to a 1.42% equity stake in the bank.
What Is Federal Bank’s Plan?
Federal Bank’s board has approved raising up to ₹6,000 crore through a mix of equity and debt instruments. Regarding equity, the bank plans to raise funds via rights issues, preferential allotments, follow-on public offers (FPOs), qualified institutional placements (QIPs), global depositary receipts (GDRs), American depositary receipts (ADRs), or foreign currency convertible bonds (FCCBs), either individually or in combination.
On the debt side, the board has approved raising funds through Additional Tier 1 (AT1) bonds, Tier 2 bonds, long-term infrastructure and affordable housing bonds, masala bonds, green bonds, and non-convertible debentures (NCDs). These can be issued through private placements in domestic and international markets.
How Is the Business Performing?
Federal Bank had a strong last quarter for the fiscal year 2024-25. From January to March 2025, the bank’s net profit rose 13.7% year-on-year to ₹1,030.2 crore, up from ₹906.3 crore in the same quarter last year. During this period, the company’s net interest income (NII) also increased 8.3% to ₹2,377.4 crore. Improved operational efficiency lifted the net interest margin (NIM) to 3.12%. Regarding asset quality, gross non-performing assets (NPAs) improved on a quarterly basis from 1.95% to 1.84%, and net NPAs declined from 0.49% to 0.44% in the March quarter.
Looking at the shares, after hitting a record high of ₹216.90 on December 5, 2024, the stock dropped 20.26% over about three months, reaching a one-year low of ₹172.95 on March 3, 2025. However, the shares recovered strongly, gaining 26.02% in just four months to reach a new record high of ₹217.95 today, July 1, 2025. Looking ahead, according to data on IndMoney, out of 34 analysts, 28 have given a buy rating, 5 a hold, and only 1 a sell rating. The highest target price is ₹260, and the lowest target price is ₹175.
Disclaimer: This article is just for information. It should not be treated as investment advice in any way. Investing in the stock market is based on risk. Be sure to consult your financial advisor before investing in the stock market.
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