Bandhan Bank’s shares fell sharply after the lender trimmed its FY27 exit return-on-assets target to 1.2-1.4%, from 1.6-1.8%, citing external factors such as higher funding costs and elevated technology expenses. The downgrade came despite a 35% year-on-year rise in Q1 net profit to about Rs 502 crore, driven by lower provisions and a steady net interest margin of around 6.2%, as net interest income grew modestly. The bank also highlighted pressures from a softer net interest margin outlook, tighter liquidity, and higher operating costs, which could delay reaching its medium-term RoA ambitions. Technical and market data showed the stock slipping into the lower circuit in some sessions, with shares down roughly 10-14% as investors digested the guidance cut alongside solid quarterly results. Asset quality improved, with sharp reductions in provisions and improved gross and net NPAs, but management warned that external headwinds could weigh on costs and growth in the near term. Analysts remained divided, with some keeping neutral ratings and price targets, noting that the RoA revision and cost pressures are the key near-term overhangs despite the stronger quarterly earnings.