HDFC Bank, IndusInd Bank, YES Bank hit lifetime highs

Shares of three private sector banks – HDFC Bank, IndusInd Bank and YES Bank – have hit their respective lifetime highs on expectation of robust earnings for the first quarter (April –June) of the current financial year 2016-17.

YES Bank (up 2.5% at Rs 1,147), HDFC Bank (2% at Rs 1,196) and IndusInd Bank (up 1.8% at Rs 1,147) were up more than 1% each, touching their respective record highs on the BSE in intra-day trade. At 10:24 AM, the S&P BSE Sensex was up 1.7% or 472 points at 27,598.

IndusInd Bank is schedule to declare the unaudited Financial Results for the quarter ended June 30, 2016 (Q1) on Monday, July 11, 2016. YES Bank will announce it Q1 results on July 27, 2016, while HDFC Bank is yet to declare the results date.

According to Edelweiss Securities, the loan growth of these three banks to be significantly higher than industry.

“IndusInd Bank’s loan growth to be significantly higher than industry, with the continued tilt towards consumer finance division. Fee income trends to continue superior performance,” the brokerage firm said in a results preview.

“YES Bank’s impairment ratio will likely be contained, while fee income trends to be in line with loan growth largely driven by transaction banking. HDFC Bank’s loan growth to be higher than industry, capturing in the growth from public sector undertaking (PSU) peers. Fee income to display steady momentum, asset quality trends continues to remain benign”, added report.

“We expect retail loan growth to maintain high growth trajectory (mortgage, vehicle financing) on the back of continued monetary easing, while capex cycle would take some more time to revive. Overall, we expect private retail lenders like HDFC Bank, IndusInd Bank, Yes Bank to report higher growth than industrial lenders like ICICI Bank, Axis Bank, State Bank of India, Punjab National Bank etc. Margins for the entire sector likely to remain under pressure as MCLR implementation would occur in current quarter however we remain positive on YES Bank followed by IndusInd Bank from margin perspective in the medium term,” Antique Stock Broking said in Q1 results preview.