Private sector banks lead losses as Sensex plunges 1,200 points

  • IANS
  • Stock Market News
Private sector banks lead losses as Sensex plunges 1,200 points
Credit: © Reuters.

New Delhi, Jan 17 (IANS) Private sector bank stocks were the biggest losers on Wednesday as the Sensex plunged 1,200 points.Index heavyweight, HDFC Bank (NS: HDBK ) is down 6.7 per cent, Kotak Mahindra (NS: KTKM ) is down more than 3 per cent, Axis Bank (NS: AXBK ) is down 2 per cent, ICICI Bank (NS: ICBK ) is down 2 per cent.

AU Bank is down 3.5 per cent, RBL Bank (NS: RATB ) is down 3 per cent, Yes Bank (NS: YESB ) is down 3 per cent, RBL Bank is down 3 per cent. BSE Private Banks index is down more than 3 per cent. South Indian Bank (NS: SIBK ) is down more than 4 per cent, Union Bank is down 3 per cent.

Elara Securities said in a report that HDFC Bank’s Q3 PAT of Rs 163.7 billion was broadly in line with our estimates following higher other income (stake sale in Bandhan Bank (NS: BANH )) and lower tax, even as core profitability fell short of expectations.

The key highlight was higher-than-expected strain on NIM (even on trimmed expectations), given higher funding cost pressures.

Given the regulator’s focus on CD ratio and HDFCB already at 110 per cent, with LCR of 110 per cent, the bank has much to balance (growth versus NIM conundrum).

While one may argue on bottoming of earnings, we believe recovery may take longer and the stock may see time correction till investors find merit in execution, the report said.

(Sanjeev Sharma can be reached at Sanjeev.s@ians.in)

--IANS

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  • Atul Sharma @Atul Sharma
    needed any reason to get market down 😀
    Like 1

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