{"id":12029,"date":"2022-09-19T11:00:08","date_gmt":"2022-09-19T05:30:08","guid":{"rendered":"https:\/\/blogs.univest.in\/?p=12029"},"modified":"2022-09-26T22:06:38","modified_gmt":"2022-09-26T16:36:38","slug":"banking-sector-reports-decent-q1fy23-performance","status":"publish","type":"post","link":"https:\/\/univest.in\/blogs-2\/banking-sector-reports-decent-q1fy23-performance\/","title":{"rendered":"Banking Sector reports decent Q1FY23 performance"},"content":{"rendered":"

\u201cThe Q1FY23 operating performance of banks under our coverage demonstrated an upbeat stance on advance growth and credit cost outlook. Nonetheless, reported earnings missed our expectations due to MTM hit and elevated Opex. NIMs just stayed put (as against expectations of improvement) as upward repricing of EBLR\/MCLR loans will likely take 3-6 months reset period to fully reflect in yields\u201d said ICICI Securities.<\/p>\n

Following the same, it can be said that several significant banks in the sector have seen around 16% YoY & 2% QoQ growth in NII. Their core operating profit grew 17% YoY, while treasury loss dragged operating profit lower by 13% YoY and 18% QoQ. Whereas subsiding credit cost and lower base supported 35% YoY earnings growth. Yet, earnings of SBI, HDFC Bank<\/a> and Kotak lagged investors expectations, they still came out to be robust, keeping in the mind global recessionary fears & falling of rupee value.<\/p>\n

As the situation still seems to be improving, Bank Nifty has also broken one of their past resistances and made a robust up move post Q1FY23. It is also noteworthy that the otherwise underperforming PSU banks fared better their private sector counterparts in the past few months which have helped the Banknifty scale towards new highs.<\/p>\n

\"Banking<\/p>\n

IndusInd Bank & ICICI Bank<\/a> are the leaders in YTD returns among the private banks. IndusInd Bank and ICICI Bank, both gave robust above 20% return YTD. While SBI also gave almost 20% returns, Kotak Mahindra and HDFC Bank seems to be losing their steam.<\/p>\n

Now, as NIFTY50 is trading near 18,000 levels and analysts are expecting it to make a new high, by crossing the resistance with high volumes, let\u2019s check how the sentiment plays for the banking sector. We will now analyse quarterly performance of these five banks mentioned in the graph above, to understand the performance of the Banking sector in Q1FY23 and prospects going forward.<\/p>\n

\n
\n

Table of Contents<\/p>\nToggle<\/span><\/path><\/svg><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n