At 09:41 AM; Nifty Bank, Nifty Private Bank and Nifty PSU Bank indices were down 1.5 per cent to 2 per cent on the National Stock Exchange (NSE). In comparison, the Nifty 50 was down 0.67 per cent. In past two trading days, the banking indices have declined between 4 per cent and 5 per cent, as against 2 per cent decline in the benchmark index.
ICICI Bank, HDFC Bank, Axis Bank, Bandhan Bank and State Bank of India (SBI) were down 2 per cent today. In past one week, Bank of India, YES Bank, RBL Bank, Indian Overseas Bank, Central Bank of India, Union Bank of India, Axis Bank, Bank of Baroda and Canara Bank slipped in the range of 6 per cent to 10 per cent. The Nifty 50 was down 1.5 per cent in past one week.
A sharp fall in banking shares has been witnessed after US-based investment research firm, Hindenburg Research, alleged on Wednesday that the Adani group had engaged in “a brazen stock manipulation and accounting fraud scheme”. It also accused the conglomerate of improper use of offshore tax havens, and flagged concerns about the group’s high debt. CLICK HERE FOR FULL REPORT
However, global broking and research firm CLSA said on Thursday, that the Adani Group poses no "significant downside risk" to Indian banks. It said that the total exposure of Indian banks is less than 40 per cent of the group's total debt.
Also read: Adani Group shares sink up to 20%
“Indian banking exposure is less than 40 per cent of total group debt. Within this, private banks’ exposure is below 10 per cent of total group debt and most banks (including ICICI/Axis) have indicated that they have largely financed assets with strong cashflows, such as airports/ports,” CLSA said in India financials sector outlook.
The foreign brokerage firm further said, PSU banks do have material exposure (30 per cent of group debt) but this debt has not increased in the past three years. Most of the incremental funding to the group for new businesses and acquisitions has come via overseas sources.
To conclude, the ballpark exposure of private banks is 0.3 per cent of FY24 loans and 1.5 per cent of FY24 networth. For PSU banks, the exposure is 0.7 per cent of FY24 loans and 6 per cent of FY24 networth, CLSA said.
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →
Quarterly Starter
₹900
3 Months
₹300/Month
Smart Essential
₹2,700
1 Year
₹225/Month
Super Saver
₹3,900
2 Years
₹162/Month
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Access to Exclusive Premium Stories Online
Over 30 behind the paywall stories daily, handpicked by our editors for subscribers


Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share


Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor


Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements


Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app