HDFC, ICICI and Axis lead India's busiest earnings day
India's largest private lenders are set to report first-quarter results today, offering a critical health check on the banking sector as markets rally to offset macroeconomic headwinds.
HDFC Bank, ICICI Bank, Axis Bank and Kotak Mahindra Bank are among more than 20 Indian companies releasing June quarter earnings on July 18. The simultaneous reporting by the country's banking heavyweights makes this the busiest day of the current earnings season. Investors are looking to these results for definitive signals on corporate profitability and credit demand at the start of the financial year.
Ahead of the announcements, Indian equities posted significant gains on July 17. The Sensex climbed 1.25% to settle at 78,151.45, while the Nifty 50 rose 1.09% to close at 24,334.30. Advances in Reliance Industries and the major private banks managed to counteract broader market weakness driven by rising crude oil prices and geopolitical tensions in the Middle East.
Analysts anticipate steady performance from the sector's largest players. Motilal Oswal Financial Services projects HDFC Bank's net profit will rise 5.9% year-on-year to ₹19,226 crore, supported by an 8.5% increase in net interest income to ₹34,110 crore. The brokerage expects the lender's gross non-performing asset ratio to improve to 1.1%, with net interest margins holding flat.
ICICI Bank is likewise forecast to deliver a 3.1% increase in net profit to ₹13,164 crore, driven by double-digit loan growth and stable asset quality with a gross NPA ratio holding at 1.4%. Motilal Oswal anticipates a marginal sequential decline in its net interest margin due to seasonal factors, though adjusted margins should remain stable.
Axis Bank faces more scrutiny regarding margin compression. Motilal Oswal forecasts a five basis point sequential drop in net interest margins due to faster corporate loan growth, even as net profit is expected to jump 15% year-on-year. Kotak Institutional Equities also projects an eight basis point sequential margin contraction.
Slippages are a key concern for Axis Bank. "We expect slippages of nearly ₹4700 crore (nearly 1.5% of loans), mostly led by retail and LLP of nearly 50 bps," Kotak Institutional Equities noted. The brokerage added that management commentary on asset quality, FCNR deposits, and return on equity normalisation will dominate discussions.
Beyond the private banking giants, the day's results include state-run lenders such as Punjab National Bank and IDBI Bank. Industrial firms like India Cements, JK Cement and Can Fin Homes are also on the schedule. Together, these filings will provide a comprehensive snapshot of early fiscal year momentum across Indian finance and industry.
