HDFC Bank, Axis to Kotak Bank: Why Did ICICI Sec downgrade these top private lenders? Explained

Bank stocks: Dalal Street Darlings HDFC Bank, Axis Bank, And Kotak Mahindra Bank have just ben downgraded by leading domestic brokege ICICI Securitys from ‘Buy’ Buy ‘Buy’ Buy to ‘Add’ Add ‘Add’ Add Limited Amid AMID Near-Term Performance Expectations, Especially Around Earnings Growth.

According to the brokerage, these private banks will see near-term weakness in net interest income (NII) and Profit after tax (Pat) Along with Weak CREDIT GRWTH, Thus Pressuring the lenders.

While a rate cut by the reserve bank of India (RBI) is seen as boosting the banking counters, ICICI Securities Believes IT COLD PRESSURIS The Net Interest Margins (NIMS) For HDFC Bank, Axis Bank, Axis Bank and Kotak Mahindra Bank Due to a Mismatch in the Loan and Deposit Rates.

Pressure on Margins

The brokerage explained that faster re-pricing of loans yields, especially under the external benchmark lending rate regime, would be on Nims Across Across Across Banks.