The banking sector will be in sharp focus on July 19, with major private lenders including HDFC Bank, ICICI Bank, Kotak Mahindra Bank, and Axis Bank scheduled to announce their quarterly earnings tomorrow (July 17).
These results assume greater significance at a time when banking stocks have largely underperformed the broader market, making the earnings outcome crucial for gauging the sector’s near-term outlook and investor sentiment.
| Timeframe | Returns |
| 1 Week | 0.81% |
| 1 Month | 1.50% |
| 3 Months | 4.52% |
| 6 Months | -1.32% |
| Year-to-Date (YTD) | -1.66% |
| 1 Year | 1.32% |
As of 11:48 am, the Nifty Private Bank index was up 1.4 per cent, or 387.10 points, at 28,302.70, ahead of the earnings announcements from major private sector lenders.
HDFC Bank Q1 Result Preview
Net Interest Margin (NIM) Trajectory
NIM is estimated at 3.32 per cent for Q1FY27 versus 3.38 per cent in Q4FY26. Management commentary on the NIM trajectory after recent rate cuts will be a key monitorable.
Loan Growth and Deposit Growth
Gross advances are expected at Rs 30.61 lakh crore, up 3.4 per cent QoQ and 15.4 per cent YoY, while deposits are expected at Rs 31.71 lakh crore, up 2.1 per cent QoQ and 14.7 per cent YoY.
CASA Ratio
CASA deposits are expected at Rs 10.26 lakh crore, down 3.3 per cent QoQ, with the CASA ratio at 32.36 per cent, compared with 34.14 per cent in Q4FY26. Deposit mix improvement and outlook for CASA recovery will be in focus.
Asset Quality
Gross NPA ratio is estimated at 1.15 per cent, unchanged sequentially, while Net NPA ratio is seen at 0.38 per cent, also unchanged QoQ. Credit costs are expected at 45-50 bps, with asset quality across segments expected to remain steady.
Management Commentary
- Investors will watch for management’s outlook on:
- Credit-deposit ratio and liquidity (LCR)
- Cost of funds and pace of term deposit repricing
- Operating leverage and cost-to-income improvement
- ROA sustainability despite NIM pressure
- Progress on mortgage cross-sell synergies and retail franchise
- Loan growth guidance for FY27 across retail and corporate segments
Axis Bank Q1 Result Preview
Net Interest Margin (NIM)
NIM is estimated at 3.50 per cent for Q1FY27 versus 3.62 per cent in Q4FY26. Expectations are for NIMs to decline due to faster growth in the corporate book and seasonally higher slippages in the first quarter.
Gross advances are expected at Rs 12.73 lakh crore, up 2.3 per cent QoQ and 18.8 per cent YoY, while total deposits are expected at Rs 13.73 lakh crore, up 2.8 per cent QoQ and 18.2 per cent YoY.
CASA deposits are expected at Rs 5.22 lakh crore, down 1.4 per cent QoQ, while term deposits are expected to rise 5.5 per cent QoQ and 22.8 per cent YoY. The deposit mix will remain a key monitorable.
Asset Quality and Credit Costs
Gross NPA is estimated at 1.37 per cent and Net NPA at 0.40 per cent. Credit costs are expected to decline in FY27 due to a reduction in technical slippages.
- Investors will watch for management’s outlook on:
- Loan growth across corporate, SME and retail segments
- Credit costs and technical slippages
- Operating expenses and cost-to-income ratio
- NIM trajectory amid changes in the loan mix
- Deposit franchise and CASA trends
ICICI Bank Q1 Result Preview
Net Interest Margin (NIM)
NIM is estimated at 4.18 per cent for Q1FY27 versus 4.32 per cent in Q4FY26. Management commentary on the FY27 NIM outlook and the impact of further rate cuts will be closely watched.
Loan and Deposit Growth
Loan growth is expected at 4.1 per cent QoQ and 18.5 per cent YoY, led by gold loans, corporate, personal loans and mortgages. Deposits are expected to grow 3.2 per cent QoQ and 15.2 per cent YoY.
Asset Quality and Credit Costs
Gross NPA ratio is estimated at 1.45 per cent versus 1.40 per cent in Q4FY26, while Net NPA ratio is seen at 0.37 per cent versus 0.33 per cent. Credit costs are expected to remain steady, with management guidance after normalisation from unusually low Q4 provisions in focus.
Provisions and Profitability
Provisions are estimated at Rs 1,727 crore versus Rs 96 crore in Q4FY26, while net profit is expected at Rs 13,369 crore, down 2.4 per cent QoQ and 1.4 per cent YoY. Provisioning is expected to normalise after Q4 write-backs and recoveries.
Management Commentary
- Investors will watch for management’s outlook on:
- FY27 NIM trajectory and impact of further rate cuts
- Deposit repricing benefits and cost of funds
- Loan growth across SME, rural, mortgages and corporate segments
- Deposit growth versus advances and funding mix
- Credit cost guidance after normalisation from Q4 provisions
Kotak Mahindra Bank Q1 Result Preview
Net Interest Margin (NIM)
NIM is estimated at 4.50 per cent for Q1FY27 versus 4.67 per cent in Q4FY26. Investors will watch NIM resilience amid deposit repricing and recent rate cuts.
Net advances are expected at Rs 5.12 lakh crore, up 3.3 per cent QoQ and 15.1 per cent YoY, while total deposits are expected at Rs 5.73 lakh crore, broadly flat QoQ and up 11.7 per cent YoY. The outlook for retail, SME and corporate loan growth will be in focus.
CASA deposits are expected at Rs 2.31 lakh crore, down 6.7 per cent QoQ but up 10.2 per cent YoY. Deposit pricing and the trend in low-cost deposits will be key monitorables.
Asset Quality and Credit Costs
Gross NPA is estimated at 1.15 per cent versus 1.20 per cent in Q4FY26, while Net NPA is seen at 0.26 per cent versus 0.25 per cent. Investors will track credit costs, slippages, GNPA and NNPA for signs of continued improvement.
- Investors will watch for management’s outlook on:
- NIM resilience amid deposit repricing and rate cuts
- Credit costs and sustainability of Q4 improvement
- Loan growth across SME and mortgage segments
- Recovery in fee income, particularly from credit cards, transaction banking and wealth management
- Normalisation in subsidiary earnings following Q4 MTM-related volatility
- Geopolitical risks, monsoon outlook, rural demand and deposit pricing
(Disclaimer: The above article is meant for informational purposes only and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money-related decisions.)
