Friday, May 27

Nifty Bank Slips 3%; Rbl Bank Down 7%, Icici Bank, Hdfc Bank Drag

Nifty Bank fell 3 percent on Monday amid an overall negative trend in the market. Banking sector stocks traded lower on the NSE with 11 of 12 stocks in the red and Bandhan Bank limiting losses.

ICICI Bank shares gained 1.5 percent in intraday trading today after a strong third-quarter result. The bank’s profit after tax (PAT) at Rs 6,193.71 crore beat Street’s estimates, up 25 per cent from the previous quarter.

However, at the time of writing, shares of ICICI Bank were trading 0.72 per cent lower at Rs 798.70 despite positive comments from brokerage houses.

Credit Suisse has maintained an ‘outperform’ rating on the bank’s shares with a price target of Rs 930. Another global broker, JP Morgan, maintained its ‘overweight’ rating on the stock with a price target of Rs 930.

Market expert Mitessh Thakkar remains very positive on ICICI Bank. “It has hardly been corrected in this drop and as long as shares can continue to close above these 788-790 rupees levels, I will remain positive,” he told CNBC-TV18.

Shares of HDFC Bank remained in red territory and fell 1.7 percent to an intraday low of Rs 1,495.70 on the NSE.

Despite the correction, several analysts remained positive on both HDFC Bank and ICICI Bank.

“Two large-cap names, HDFC Bank and ICICI Bank, are showing strength. There has been a huge short hedging attack on HDFC Bank in the last trading session. ICICI Bank is not correcting much,” said Siddarth Bhamre, director of alternative investments and research at InCred Equities.

Market expert Prakash Diwan preferred ICICI Bank to HDFC Bank as he believes the former can recover more given the advance. He is of the opinion that the restarts that occurred between ICICI Bank and HDFC are likely to be much deeper and stronger in 2022.

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He referred to the comparison between the two stocks similar to what is happening with Infosys versus Tata Consultancy Services (TCS) in recent years. While both businesses are doing well, promising enough, it’s a relative strength being talked about, he said.

“From that perspective, I think ICICI Bank has a lot more room to go, and then you’ll see capital coming back with each subsequent quarter if the performance is likely to be what we saw yesterday, so that’s very positive. And I am sure that the re-rating will continue and become stronger compared to HDFC,” he told CNBC-TV18.

Meanwhile, after rising 1.7 percent in early trading, shares of IndusInd Bank also gave up gains in afternoon trading. The stock fell 2.7 percent from a day’s high to an intraday low of Rs 845.75.

RBL Bank was the main laggard in the Nifty Bank pack as its shares fell almost 7 per cent to an intraday low of Rs 136.50 on NSE. Shares of State Bank of India (SBI) and Axis Bank fell 1.7 percent and 2 percent, respectively.

Bandhan Bank shares were the only green in the pack. The bank’s shares rose more than 5 percent to a high of Rs 310.65 in intraday trading.

The downtrend in bank stocks comes on a day when the market is seeing a sharp correction with the benchmark Sensex and Nifty indices close to 3 percent.

Meanwhile, shares of CBS Bank (not part of the Nifty Bank package) were trading 1.7 per cent higher at Rs 245.50 and up more than 6 per cent in intraday trading after third-quarter gains. . The bank reported a net profit of Rs 148.25 crore, up 25 per cent quarter-on-quarter and its net non-performing assets (NPA) decreased 46 per cent quarter-on-quarter to Rs Rs 199.74 crore. rupees

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Releasing the result, CVR Rajendran, CEO of CSB Bank, said traction in gold lending is improving and the growth rate is expected to improve further. Gold lending growth in the fourth quarter is likely to be much stronger than third-quarter rates, he said.

First published: IS

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