IDFCFIRSTB.NS
IDFC FIRST BANK LIMITEDClosedIDFCFIRSTB.NS discounted cash flow valuation
IDFC FIRST BANK LIMITED is a banks - regional company. Its cash flows include lending and deposits, so free cash flow isn't owner earnings and this model can mislead. Compare it with peers on book value and earnings instead.
IDFCFIRSTB.NS Fair Value
Reverse DCF: today's price implies 2.9% a year of FCF growth for years 1–5, against 25.0% in this model.
Model: 25.0% from analyst next-year EPS & revenue growth (capped). Fades linearly to terminal growth by year 10.
Model: 9.09% (CAPM, see the build-up).
Long-run growth after year 10; keep it at or below nominal GDP.
Value Bridge
| PV of free cash flow, years 1–10 | INR 1.15T |
|---|---|
| PV of terminal value (64% of EV) | INR 2.05T |
| Enterprise value | INR 3.20T |
| + Cash & investments | INR 133.59B |
| − Total debt | −INR 413.97B |
| Equity value | INR 2.92T |
| ÷ Shares outstanding | 8.62B |
| Value per share | INR 338.93 |
| Market cap | INR 679.01B |
Discount Rate Build-up
| Risk-free rate (10-yr Treasury) | 5.22% |
|---|---|
| Beta (clamped 0.5–2.5) | 0.58 |
| Equity risk premium | 5.00% |
| Cost of equity (CAPM) | 8.11% |
| Pre-tax cost of debt | 12.00% |
| Tax rate | 10.9% |
| Debt / (equity + debt) | 37.9% |
| WACC | 9.09% |
Cost of debt is interest expense ÷ total debt, held between the risk-free rate and 12%.
Free Cash Flow: History and Projection
Sensitivity: Value per Share
| WACC ↓ / g → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 7.09% | 441.03 | 480.36 | 528.24 | 587.82 | 663.99 |
| 8.09% | 358.92 | 385.28 | 416.33 | 453.48 | 498.72 |
| 9.09% | 298.94 | 317.53 | 338.93 | 363.84 | 393.19 |
| 10.09% | 253.33 | 266.95 | 282.36 | 299.94 | 320.18 |
| 11.09% | 217.56 | 227.84 | 239.32 | 252.21 | 266.80 |
Green is above today's price, red below (full colour at ±30%). The outlined centre cell is the current inputs.
Projected Cash Flows
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Base (FY2026) | — | INR 60.39B | — | — |
| Year 1 | 25.0% | INR 75.49B | 0.917 | INR 69.20B |
| Year 2 | 25.0% | INR 94.36B | 0.840 | INR 79.29B |
| Year 3 | 25.0% | INR 117.95B | 0.770 | INR 90.86B |
| Year 4 | 25.0% | INR 147.44B | 0.706 | INR 104.11B |
| Year 5 | 25.0% | INR 184.30B | 0.647 | INR 119.29B |
| Year 6 | 20.5% | INR 222.09B | 0.593 | INR 131.77B |
| Year 7 | 16.0% | INR 257.62B | 0.544 | INR 140.11B |
| Year 8 | 11.5% | INR 287.24B | 0.499 | INR 143.21B |
| Year 9 | 7.0% | INR 307.35B | 0.457 | INR 140.47B |
| Year 10 | 2.5% | INR 315.04B | 0.419 | INR 131.98B |
Method
Two-stage free-cash-flow model, the same as the bot's lgf dcf: five years at the chosen growth rate, a straight-line fade to terminal growth by year ten, then a Gordon-growth terminal value. Everything is discounted at WACC.
Base cash flow is the trailing four quarters of operating cash flow minus capital expenditure (the latest fiscal year when quarters are missing). Default growth uses analyst long-term growth when Yahoo publishes it, else the average of next year's EPS and revenue growth, else revenue CAGR, held between −5% and 25%.
A DCF is only as good as its inputs. The terminal value is usually most of the answer, so read the sensitivity grid before the headline number. This is a model, not investment advice.