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Total Card Spends decreased during Jun'25 (stood at Rs 1.83L Cr Vs Rs.1.90L Cr in May'25). Credit Card spends decreased by ~3.6% MoM (v/s Increased ~3% in Apr'25), while it grew ~15% YoY vs ~15% in May'25. Total number of cards in force stood at ~111.2Mn as of May'25 (up by ~7% YoY and ~0% MoM). Net New Cards additions in the month were almost Nil; it is flat on MoM basis (vs 7.6 lakhs in May'25), indicating a cautious or subdued sentiment among lenders towards unsecured loans. New card issuances were majorly led by HDFCB (~2.1 lakhs), SBI (~0.8 lakhs), and Yes Bank (~1 lakh). Volume of transactions decreased by ~2% MoM (vs. up by ~4% in Apr'25),...

Q1FY26 Earnings Preview - Banks, Financial Services & Insurance (BFSI)

be a key monitorable in this quarter. Due to seasonality in case of PSU banks, fees might fall by 11.1% QoQ but grow by 15.1% YoY to Rs394.7bn, which would be partially offset by 5.9% QoQ fall in opex to Rs914bn (+11.2% YoY). Core PPoP may be Rs927bn (-1.5% QoQ/+3.4% YoY) due to weaker NII/fees. Slippage ratio may increase owing to rise in agri slippages (usually in Q1). Banks' PAT is expected to decrease by 5.3% QoQ but increase by 6.2% YoY to Rs673bn....

Banking sector (non-food) credit growth stood at 9.6% as on 13 Jun'25 vs ~8.8% in May'25 (vs ~11% in FY25). The latest sectoral deployment data showed that credit growth moderated in agri, industry and services sectors in May'25, partly attributable to high base. Agri loans stood to 7.5% in May'25 vs 9.2% in Apr'25. Loans to industries moderated to 4.8% in May'25 vs 6.6% in Apr'25, due to slowdown in particularly large industries. Services sector growth too softened to 8.7% vs 10.5% YoY in Apr'25. Growth in loans to NBFCs declined to -0.3% YoY in May'25 vs +2.9% YoY in Apr'25. However, loan to retail segment slightly moderated...

Total Card Spends improved during May'25 (stood at Rs 1.90L Cr Vs Rs.1.85L Cr in Apr'25). Credit Card spends increased by ~3% MoM (v/s -8.6% in Apr'25), while it grew ~15% YoY vs ~18% in Apr'25. Total number of cards in force stood at ~111.2Mn as of May'25 (up by ~8% YoY and ~0.7% MoM). Net New Cards additions stood at ~7.6 lakhs (vs 5.5 lakhs in Apr'25), indicating an improved sentiment among lenders towards unsecured loan. New card issuances were majorly led by HDFCB (~2.8 lakhs), SBI (~1.3 lakhs), and AXIS (~1.1 lakh). Volume of transaction increased by ~4% MoM (vs. -2% in Apr'25), whereas it grew by ~29.7 % YoY (vs ~30.7% in Apr'25). We expect card spends to...

since Apr'25. We could see a credit upcycle from FY27E suggesting higher than expected loan growth. Sensitivity analysis indicates that if loan growth for FY27E is 210bps higher at 14.7% YoY, aggregate core PAT would be upgraded by 3.6%; sector would re-rate and multiples/TP could increase by 5.0-11.0%. However, in a credit upcycle, valuation discount of other banks to sector leaders like ICICB/HDFCB (6-7% upgrade) would narrow suggesting higher upgrades. From an alpha generation perspective, we would prefer players like...

Banking sector (non-food) credit growth moderated to 9.8% as on 16 May'25 vs ~10.2% in Apr'25 (vs ~11% in Mar'25). The latest sectoral deployment data showed that credit growth moderated in agri, industry and services sectors in Apr'25. Agri loans stood to 9.2% in Apr'25 vs 12.4% in Mar'25. Loans to industries moderated to 6.6% in Apr'25 vs 7.8% in Mar'25, due to slowdown in particularly large industries. Services sector growth too softened to 10.5% YoY vs 12.4% YoY in Mar'25. Growth in loans to NBFCs slowed to 2.9% YoY in Apr'25 vs 5.7% in Mar'25. However, loan to retail segment slightly improved to ~12% YoY in Apr'25 from 11.6% in Mar'25, aided...

In a boost for the sector, RBI eases LCR norms To improve system liquidity and consequently spur credit growth, RBI has changed its stance to accommodative since Dec'24 as effected by (1) CRR cut of 50bps in Dec'24 (2) repo rate cut of 50bps till date (2) OMOs purchase of G-Sec by RBI to improve liquidity (3) postponing the applicability of new LCR guidelines by a year to 1st Apr'26. In this backdrop of its accommodative stance, RBI has relaxed some requirements of the new LCR framework....

better NIM movement. Due to seasonality in case of PSU banks, fees might grow at 11.4% QoQ, to Rs429.7bn (vs -1.3% in Q3FY25), which would be more than offset by rise in opex to Rs971bn (+7.2% QoQ). Core PPoP may be Rs944bn (-0.7% QoQ). Large private banks (ex-IIB) may outperform on core PPoP. Gross slippage ratio might improve slightly post elevated agri slippage in Q3FY25. Banks' PAT is expected to decrease by 5.7% QoQ to Rs634.3bn due to lower...

Positive Result Plays: Banks ICICI Bank, HDFC Bank, SBI, Kotak Mahindra Bank NBFCs Shriram Finance, Bajaj Finance, Cholamandalam Negative Result Plays: CreditAccess Grameen, Equitas SFB

saw negative growth of avg. 8.3% YoY over Nov'20 to Oct'21. However, due to stronger rebound, over Apr'22-Sep'23 credit growth in NBFCs jumped to avg. 33.4% YoY. Similarly, growth for the unsecured segment (PL/CC) over Nov'20 to Oct'21 was average 10% YoY which jumped to avg. 26.5% over Apr'22-Sep'23....

Top Conviction Ideas (BFSI) - ICICI Bank, HDFC Bank, State Bank of India, City Union Bank, Bajaj Finance, Cholamandalam Investment & Finance, Shriram Finance

Q3FY25 Earnings Preview - Banks, Financial Services and Insurance (BFSI)