IDFC First Bank vs AU Small Finance Bank Which Is More Favorable?

IDFC First Bank and AU Small Finance Bank are two prominent players in the Indian banking industry, each catering to different segments of the market. IDFC First Bank focuses on providing a wide range of financial services to customers, while AU Small Finance Bank specializes in serving the needs of small and medium enterprises. Both banks have shown steady growth in recent years, but investors must consider factors such as market trends, regulatory environment, and financial performance before making investment decisions in these stocks.

IDFC First Bank or AU Small Finance Bank?

When comparing IDFC First Bank and AU Small Finance 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 IDFC First Bank and AU Small Finance 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. IDFC First Bank has a dividend yield of -%, while AU Small Finance Bank has a dividend yield of 0.17%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. IDFC First Bank reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, AU Small Finance 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 IDFC First Bank P/E ratio at 20.97 and AU Small Finance Bank's P/E ratio at 23.89. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. IDFC First Bank P/B ratio is 1.31 while AU Small Finance Bank's P/B ratio is 2.71.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, IDFC First Bank has seen a 5-year revenue growth of 3.12%, while AU Small Finance Bank's is 2.82%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with IDFC First Bank's ROE at 7.11% and AU Small Finance Bank's ROE at 13.65%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are ₹63.07 for IDFC First Bank and ₹574.30 for AU Small Finance Bank. Over the past year, IDFC First Bank's prices ranged from ₹59.30 to ₹92.45, with a yearly change of 55.90%. AU Small Finance Bank's prices fluctuated between ₹553.70 and ₹813.40, with a yearly change of 46.90%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.