The market’s focus is on the banking sector. Bank shares put pressure on the market in the trading on January 17. The main reason for this was Axis Bank. Actually the market did not like the results of Axis Bank. In such a situation, when will the selling in banks stop and will the results of other banks also be weak in the future? What investment strategy should be made in banks now? Talking about this in detail Rahul Malani, Senior Analyst, Mirae Asset Sharekhan Says that if seen on the sectoral front, Axis Bank has underperformed. Visibility of loan in the bank may remain low for the coming 6-9 months. Challenges will remain regarding asset quality in the bank. It can be clearly inferred from the management commentary that the chances of pick out seem less.
He further said that even though the valuations of the bank are cheap, if there is no change in the outlook then consolidation will be seen in the stock. If we look at the NIM of the bank on a year-on-year basis, a huge compression has been seen. Because the proportion of unsecured segment in disbursement last year was large. Loan growth is degrowth due to pressure in unsecured loans. Whose effect you can see on NIM. Due to pressure in yields, there may be further pressure of 5-10 basis points in NIM.
ICICI Bank’s loan growth possible at 13-14 percent
Talking about the upcoming quarterly results of ICICI Bank, Rahul Malani said that I think ICICI Bank can have the best results in this sector. The focus will be on the asset quality of the bank in the q3 result. Loan growth is expected to be around 13-14 percent.
HDFC Bank results expected to remain stable
Talking about HDFC Bank, he further said that the market will not react much to the upcoming results as the market expects the deposit numbers and NIM figures to remain stable. Due to which the results of Q3 will be like a non-event for the bank. This is why HDFC Bank’s results are expected to remain stable.
Rahul further said that HDFC Bank may see a good re-rating in the coming 2 years.
PSU banks will perform better than private banks
Talking about PSU banks, he said that if we talk about PSU banks overall, there will be pressure in earnings growth. Because treasury gains will not be there in this quarter. Loan growth may remain moderate. There may be pressure in credit cost. But overall PSU banks will perform better as compared to private banks. However, project financing and ECL guidelines may come from RBI. That will be a pressure point for PSU banks.
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