The private sector lender is seen reporting sharp 65% YoY growth in net profit for the June quarter to Rs 3,413.4 crore. Net interest income may zoom 35% YoY to Rs 6,337 crore, observe analysts. The private sector lender is set to report its first quarter earnings on Saturday.
Sequentially, the net profit is expected to decline 2.4%, while net interest income may rise about 4%. Year-to-date, shares of the bank have gained neary 8%, but underperformed Nifty50 by about 3%.
Here is a summary of analysts’ expectations on earnings from the lender:
Motilal Oswal Securities
Expect steady traction in loan and deposit growth. Liability growth will likely remain healthy; margins will moderate to 5.6%. Unsecured loan mix will hopefully maintain an uptrend. Slippages and credit cost to remain in control.
PhillipCapital
Loan growth is expected to witness sequential growth, driven by mortgage and unsecured loans. Credit cost should move towards normalisation. Rising cost of funds will put pressure on margins.Nuvama Institutional Equities
Expect loan growth of 4% QoQ. Kotak’s NIM may decline 12 bps QoQ, lower than the decline for ICICI Bank, because of improving loan mix. From Q2, however, the decline in NIM could accelerate due to the newly launched sweep deposit scheme.
Axis Securities
Credit/deposit growth momentum to remain healthy; unsecured loans to inch up in the overall portfolio mix. Margin pressures to surface with the rising cost of funds. Cost ratios to remain stable, supporting PPoP growth.
Benign credit costs to aid in earnings growth; asset quality to remain steady. Key monitorables will be commentary on interest margins and growth outlook.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)