First Bank vs IDBI Bank Which Performs Better?

First Bank and IDBI Bank are two prominent players in the Indian banking sector, each offering unique investment opportunities for shareholders. While First Bank is known for its strong financial performance and stable growth, IDBI Bank has faced challenges in recent years due to issues with non-performing assets and corporate governance. Investors looking to diversify their portfolio should carefully consider the risk-reward profile of each bank before making an investment decision. Ultimately, thorough research and a long-term investment strategy are key to success in the stock market.

First Bank or IDBI Bank?

When comparing First Bank and IDBI Bank, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between First Bank and IDBI Bank.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. First Bank has a dividend yield of 1.64%, while IDBI Bank has a dividend yield of 1.84%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. First Bank reports a 5-year dividend growth of 14.87% year and a payout ratio of 14.99%. On the other hand, IDBI Bank reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with First Bank P/E ratio at 9.17 and IDBI Bank's P/E ratio at 12.94. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. First Bank P/B ratio is 0.92 while IDBI Bank's P/B ratio is 1.60.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, First Bank has seen a 5-year revenue growth of 0.36%, while IDBI Bank's is 0.50%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with First Bank's ROE at 10.37% and IDBI Bank's ROE at 12.93%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $14.56 for First Bank and ₹79.80 for IDBI Bank. Over the past year, First Bank's prices ranged from $11.20 to $15.87, with a yearly change of 41.70%. IDBI Bank's prices fluctuated between ₹63.40 and ₹107.90, with a yearly change of 70.19%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.