The April-June quarter earnings season is changing gears with focus shifting from IT to the banking pack.
Sector giant HDFC Bank will be the first major bank to report its earnings on Saturday, July 16, while others like IndusInd Bank, ICICI Bank and Axis Bank will release their results next week.
According to brokerages’ estimates HDFC Bank’s net profit may rise between 20 and 30% on a yearly basis, while its net interest income could grow around 16%.
The growth in loan book as well as deposits is pegged around 20% YoY each, resulting in a flat net interest margin for the quarter.
According to analysts at ICICI Securities, “containment of slippages, better recoveries, and improved collections will support HDFC Bank’s asset quality trends. However, even as treasury loss will weigh on earnings, lower provisioning relative to Q1FY22 will lead to robust net profit growth”
Overall, Bloomberg’s consensus estimates for 12 listed banks peg net profit growth at 47% YoY, and NII growth at 11.6%.
Sequentially, net profit of the sector may shrink 7.8%, while NII could decline 0.3%.
Ambareesh Baliga, Independent Market Analyst says banks to report robust numbers in Q1. Retail, SME loans to perk up loan book, he says. Treasury income will slip; NIMs to improve QoQ. Asset quality to improve, especially for PSBs, he says. BFSI sector to shine in Q1.
On Thursday, Q1FY23 results of ACC, LTI and Tata Elxsi will be on investors’ radar. Besides, wholesale inflation print for June, weekly F&O expiry, and other global cues will guide the markets.
 "How HDFC Bank, others may fare in Q1 results season")
