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Brokerages Retain Buy Ratings on ICICI, HDFC, Axis Bank After Q2 Results
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Moneycontrol•19-10-2026, 06:02
Brokerages Retain Buy Ratings on ICICI, HDFC, Axis Bank After Q2 Results
- •Brokerages have maintained their Buy ratings on ICICI Bank, HDFC Bank, and Axis Bank following their Q2 results, citing a positive growth outlook for the rest of FY27 despite margin pressures.
- •ICICI Bank emerged as the strongest performer among the three lenders, driven by robust core income growth, profitability, and a 17.7 percent year-on-year rise in net interest income.
- •Axis Bank reported the sharpest net profit increase at 37.6 percent year-on-year, aided by a lower base, while HDFC Bank saw a modest profit growth of 4.7 percent.
- •All three lenders experienced a decline in net interest margins due to foreign currency deposits raised under the RBI FCNR swap window, though analysts expect a recovery in coming quarters.
- •Valuations show HDFC Bank trading at 1.8 times its price-to-book ratio, ICICI Bank at 2.6 times, and Axis Bank at 1.8 times, presenting potential upside for investors as earnings normalize.
Key Questions Answered
In Q2, ICICI Bank reported the strongest growth in net interest income (NII) with a 17.7 percent year-on-year increase. Axis Bank's NII grew by 11.8 percent, while HDFC Bank recorded a 10 percent growth over the same period.
All three lenders reported lower net interest margins (NIMs) partly due to foreign currency deposits raised under the RBI's FCNR(B) swap window. For instance, Axis Bank noted that FCNR deposits alone reduced its margin by 11 basis points.
HDFC Bank trades at 1.8 times its price-to-book ratio against a five-year average of 2.8 times. ICICI Bank trades at 2.6 times book value compared to its historical average of 3 times, while Axis Bank trades at 1.8 times its five-year average of 2.02 times.
