ICICI Bank, HDFC Bank, SBI Are Motilal Oswal's Top Pick In Bank Stocks — Check Target Price

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Motilal Oswal Report

We continue to believe that net interest margins will remain under pressure in H1 and maybe in Q3 FY26, due to continued loan repricing. However, a gradual reduction in funding costs will enable margin recovery from H2 onward, translating into healthy earnings growth over FY27E. 

Banks are increasingly focusing on building granular and stable deposit franchises to cushion margin pressures and support balance sheet resilience. A strong liability profile is becoming a key differentiator in the current environment.

We expect systemic loan growth to remain modest at 11% in FY26E and recover to 12.5% in FY27E. The recovery will likely be led by the pick-up in consumption activity, aided by reduced GST and direct tax rates, normalization in unsecured delinquencies and a reduction in borrowing costs.

The potential recovery in earnings in H2 FY26 will mark an end to the multi-year earnings deceleration cycle and help improve sector performance.

Top ideas: ICICI Bank, HDFC Bank, and SBI.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.