HDFC Securities: Private Banks - Better Than Expected Q1 Operating  Performance
Indian rupee banknotes being counted. (Photographer: Dhiraj Singh/Bloomberg)

HDFC Securities: Private Banks - Better Than Expected Q1 Operating Performance

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

HDFC Securities Report

For our coverage, banks operating performance was ahead of estimates. Lower expected provisions resulted in a significant earnings beat.

Our overall universe saw loan growth slow expectedly, and fall behind deposit growth. Large private banks fared best on the deposit growth front.

Net interest margins expectedly compressed for most banks within our overall universe, as a result of a sharp rise in liquidity.

Gross non-performing assets dipped QoQ for our overall universe (but our private bank universe saw a slight rise), and slippages fell across the board. However, asset quality metrics were cushioned by the moratorium.

Most banks reported a sharp decline in the proportion of loans under moratorium. From the quarter, several private banks have raised/are in the process of raising capital, which will fortify their balance sheets.

Our broad thesis - large banks, with strong, granular liability franchises, reasonable asset quality performance and sufficient capital will fare better, remains unchanged.

Click on the attachment to read the full report:

HDFC Securities Banks Update.pdf


This report is authored by an external party. BloombergQuint 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 brokerage and do not represent the views of BloombergQuint.

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

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