Hi Ravi, I see from your comments that ypu are very hopeful. I have invested in idfc in past at around 30 levels when c2i guidance was 55% by Fy25…somewhere in FY22, VV changes the fwd guidance to 65% nad pushed the target to FY27. I exited the next quarter in fy22-23when this guidance got changed because based on projections of achieving 65% c2I, bank ROE was capped at 13% and ROA could never cross 1.3-1.4…hence the jump in valuation could never come. Though I exited at handsome gains of mid 60s due to sheer luck may be…but in order to project C2I, we need to look at composition of opex…don’t go by VV words…look at what’s being reported, you will notice that opex has major portion in other expenses - and those other expenses have major expenses of another other expense - for which VV never gives explanation… As small search will give you answers on how VV raises liabilities and assets from market (the growth which he keeps talking about) he pays alot to DSA agents and when this growth in loan book slows, the C2I also comes down due to other expenses going down.
Based on these things, please be a fair judge of C2I, because just by going thru VVs hopeful stories and back history of Capital First - he will continue to raise capital as keep diluting because ROE will remain capped at 13% of C2I gets floored at 65%, this means any incremental growth in balance sheet will lead to dilution in equity along with jump in C2I.
Hopefuly you will find my old projections in the comments of past which never accounted to MFI stress and hence actual dilution is even more than my projection. I have put out very detailed projections based on what VV use to say.
Every time this bank falls , new set of retail investors like me get hopeful and the cycle repeats.
Regards
Vineet