Shares of HDFC Bank Ltd., Axis Bank Ltd., and ICICI Bank Ltd. are all reacting to their second quarter results that were reported after market hours on Saturday.
While shares of HDFC Bank are down 1.7% in early trading on Monday, those of ICICI Bank are recovering from the lows of the day and are trading with gains of 0.4%. Shares of Axis Bank are witnessing the biggest impact to their results, with the stock having declined 4.5%.
None of the three lenders have any “sell” recommendations from the analysts who track them. Among the three, HDFC Bank has the highest upside potential according to the consensus estimates of price targets of analysts.
| Stock | Buy | Hold | Sell | Upside(%) |
|---|---|---|---|---|
| HDFC Bank | 47 | 2 | 0 | 35 |
| ICICI Bank | 53 | 0 | 0 | 26 |
| Axis Bank | 49 | 3 | 0 | 27 |
All three major lenders witnessed margin pressure during the quarter, with their Net Interest Margins contracting by 10 basis points to as much as 37 basis points. Axis is the lender with the steepest margin comparison at 37 basis points.
Here’s what analysts said about Axis Bank after its September quarter results:
Kotak Institutional Equities has a “buy” rating on the stock with a price target of ₹1,600. It said that while operating environment remains supportive of earnings growth, valuation upside is likely to be constrained as the stock now trades close to HDFC Bank’s valuation multiple.
Goldman Sachs also has a “buy” rating with a price target of ₹1,600. It said that loan growth is likely to remain strong, although it will moderate from current levels. The key challenge though, is around fee income, where growth remains muted but we expect continued cost optimization to partly offset that.
JPMorgan too remains “overweight” on Axis Bank with a price target of ₹1,620. It said that valuations of the lender are attractive at 1.4 times its financial year 2028 estimated price-to-book value, which is a 31% discount to ICICI Bank, thereby underpinning their positive stance.
Citi and UBS also remain positive on Axis Bank with price target of ₹1,620 and ₹1,670 respectively.
52 analysts cover Axis Bank of which 49 of them have a “buy” rating and three others have a “hold” recommendation. The consensus estimates of price targets implies an upside potential of 28% from current levels.
ICICI Bank Is A Consensus Buy
All 53 analysts covering ICICI Bank have a “buy” rating on the stock. The consensus estimates of price targets implies an upside potential of 27% from current levels.
Bernstein and JPMorgan have a price target of ₹1,800 on the stock. JPMorgan sees tailwinds for the lender’s margins to expand in the fourth quarter and in financial year 2028 as the economy moves into a higher interest rate cycle.
Goldman Sachs has among the highest price target on the street for ICICI Bank at ₹2,025 and is the only one who has a target in excess of ₹2,000 on the street for the stock.
HDFC Bank Has The Highest Upside Potential
HDFC Bank has 49 analysts covering the stock, of which 47 have a “buy” rating and the consensus estimates of price targets implies an upside potential of 35% on the stock from current levels.
Bernstein has the third-highest price target on the street for HDFC Bank at ₹1,150, although it said that the weak earnings trend continued for the lender.
JPMorgan and Goldman Sachs have price targets of ₹970 and ₹861 on the stock.
Kotak Institutional Equities said that a supportive operating environment and attractive valuations reinforce our constructive view, although execution remains the key monitorable for the lender. The firm has a “buy” rating with a price target of ₹1,050.
Shares of HDFC Bank are trading 2.1% lower on Monday at ₹713, while those of Axis Bank are looking to recover from the lows of the day, trading 3.5% lower at ₹1,243.7.
Shares of ICICI Bank opened higher but are now trading 0.4% lower at ₹1,390.8.