Banking Q2 Results Preview - Growth To See Some Slowdown Led By Moderation In Business Momentum: DRChoksey

DRChoksey Research Report

The industry credit growth is expected to moderate to 12% - 14% in FY25E, compared to 16.3% in FY24 on the back of GDP growth expectations of around 6.8% (lower growth on YoY basis), regulatory measures impacting unsecured loans, and a high base effect of FY24.

NIMs are expected to compress further due to rising deposit costs and potential rate cuts anticipated in the latter half of FY25E. This compression may challenge banks' profitability.

Banks are currently trading at 2.1x FY26E, which is lower than their five-year average industry P/B multiple, which is 2.8x.

Top Picks: We remain positive on IndusInd, ICICI Bank and SBI considering their ability to mitigate the macro risks, healthy business momentum, stable asset quality and superior return ratios.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.