Bank of Baroda’s topline: 10–12% advance growth (retail/agri-led) faces margin trade-offs; Bottomline: 5–7% EPS growth hinges on NIM stability and credit costs; Margins: 2.7–2.9% NIM range probable, with structural downside risks from funding mix and rate sensitivity.
📊 Base Case (50% Probability)
Key Variables: (1) GNPA 2.0–2.2%; (2) NIM flat at 2.8%.
Outcome: 5–7% EPS growth, ROA 0.8–0.9%, with 10% advance growth offset by 15–20 bps NIM pressure. Subsidiary drag limits consolidated ROE to 10–11%; ESG and digital initiatives remain execution risks.
Canara Bank’s topline: RAM-driven 13–15% loan growth sustainable, but deposit franchise and CASA mix remain structural drags; Bottomline: 12–15% EPS growth in base case, vulnerable to ECL/cyclical shocks; Margins: NIM floor of 2.40–2.45% assumes stable rates—downside if cuts accelerate or deposit costs rise.
📊 Base Case (60% Probability)
Key Variables: (1) Stable rate cuts (1–2 in FY27), (2) RAM growth sustains at 15–18% YoY.
Outlook: NIM stabilizes at 2.45–2.50% as deposit repricing catches up. Retail/Agri slippages remain controlled (GNPA <2.2%). ECL amortization (₹2,500 Cr/year) absorbed via profits (₹18K Cr). Treasury income normalizes to ₹1,500–2,000 Cr/quarter. Implications: 12–15% EPS growth, RoA 1.1–1.2%, CET-1 >11.5%.
SBI outlook spans three scenarios: Base Case with stable NIM at 3.0% and ROE near 21%; Bear Case with margin compression to 2.8% amid NPL stress; Bull Case with NIM expansion above 3.1% and ROE exceeding 22%.
📊 Base Case (50% Probability)
Key Variables: (1) Corporate credit growth sustains at 13–15% with term loan mix improvement, (2) CASA ratio holds at 39–40%.
Outcome: NIM stabilizes at 3.0%, credit costs at 0.30–0.35%, and fee income grows 15–20% YoY (CVE + mutual fund dividends). ROA 1.0–1.1%, ROE 20–21%. Trigger: Budgetary infrastructure spend and MSME “champion” initiatives drive RAM growth; YONO scales to 15 crore users.
Kotak Bank’s Base case sees NIMs steady at 4.5–4.6% with credit costs normalizing to 50–60bps and ROE at 12–13%. Bear case risks compression to 4.3–4.4% and higher costs. Bull case offers expansion above 4.7%, stronger ROE, and EPS upside.
📊 Base Case (50% Probability)
Key Variables: (1) Retail CV delinquencies plateau (slippages <1.2%); (2) Term deposit repricing completes by Q1 FY27.
Outcome: Credit costs normalize to 50–60bps by FY27; NIM stabilizes at 4.5–4.6% with CRR benefits. Unsecured portfolio grows 15–20% YoY, lifting ROE to 12–13%. Cost-to-income ratio improves to 46–47% on automation. EPS growth: 6–9% YoY.
Axis Bank’s base case sees NIM stabilizing near 3.6–3.7% with ROE at 14–15%, while bear case risks compression to 3.4–3.5% and ROE 12–13%. Bull case offers upside with NIM above 3.8% and ROE 16%+, hinging on deposit growth and digital monetization.
📊 Base Case (50% Probability)
Triggers: Deposit growth converges in 15–18 months, retail disbursements sustain +20% YoY, no further rate cuts.
Outcome: NIM stabilizes at 3.6–3.7% (Q4 dip offset by 2027 rebalancing), credit costs 60–70 bps, ROE 14–15%. CET-1 remains >14% (AT1 issuance likely). Action: Model 58–60% retail mix by FY28, watch Neo platform monetization.
ICICIBANK’s outlook splits into Base Case with NIM steady at 3.0–4.3% and ROE 15–21%; Bear Case with margin compression to 2.8–4.0% and ROE 13–14%; Bull Case with NIM expansion above 3.1–4.4% and ROE 17–22%.
📊 Base Case (50% Probability)
Key Variables: (1) PSL portfolio conformity achieved by H1-2027, limiting provisions to ₹12.83B; (2) Retail deposit repricing offsets 50% of repo cut impacts. Outcome: PBT grows 3–5% YoY (adjusted for provisions), with NIM stable at 4.20–4.30%. Loan growth sustains at 11–12% YoY, led by business banking. RoE holds at 15–16%. Signal: Credit card/personal loan growth recovers to 8–10% YoY by H2-2027.
Continue reading “ICICIBANK – Q3 FY26 Earnings Call – 17-Jan-26”PNB’s topline resilience (11–12% credit growth) and margin stabilization by Q2FY27 hinge on deposit repricing and ECL management; bottomline upside (5–15% EPS growth) depends on fee income scalability and recovery execution, with structural risks skewed to ECL and rate sensitivity.
📊 Base Case (50% Probability)
UNIONBANK’s loan growth of 13–15% looks sustainable, but weak deposit franchise and CASA mix remain drags. EPS growth of 12–15% is base case yet vulnerable to shocks. Margins hinge on a 2.40–2.45% NIM floor, at risk if rate cuts accelerate or deposit costs rise.
📊 Base Case (50% Probability)
Key Variables: (1) Deposit growth 8–10% YoY (CASA + ecosystem banking), (2) SMA2 stable; ECL provisioning ₹4,300 crore.
Outcome: NIM 2.70–2.80% (treasury optimization offsets rate cuts); credit cost 20–30bps. EPS grows 5–8% YoY; RoE 13–14% (ECL absorbable via retained earnings).
HDFC Bank’s Base case projects loan growth at 14–16% with NIMs steady near 3.3–3.4% and EPS rising 12–15%. Bear case risks slower growth, NIM contraction to ~3.2%, and higher credit costs. Bull case offers expansion, NIMs above 3.5%, and EPS growth near 20%.
📊 Base Case (50% Probability)
Key variables: Deposit growth at 14–15%, LDR glides to 90% by FY27; no material provision surprises.