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This Article is From Jan 12, 2021

Banks Q3 Preview: Favourable Quarter For Earnings, Says Prabhudas Lilladher

Banks Q3 Preview: Favourable Quarter For Earnings, Says Prabhudas Lilladher
A customer holds a bundle of Indian rupee banknotes while filling in a deposit form at a branch of the HDFC Bank Ltd. in Mumbai, India. (Photographer Dhiraj Singh/Bloomberg)

BQ Blue'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 BloombergQuint's subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Prabhudas Lilladher Report

Banks earnings will be strong on continued double digit net interest income growth and relatively lower provisioning, while opex revival and moderate fee/treasury income will keep pre-provision operating profit slower.

The Supreme Court has not lifted its direction on non-performing asset recognition, hence we will see another quarter of low slippages, relatively lower recovery but higher write-offs which will augur well for NPA ratios.

Focus this quarter will be on three areas -

  1. loan restructuring outcomes (negligible restructuring has been the narrative)
  2. pro-forma slippages because of a full billing based quarter and
  3. collection efficiency of loans.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. BloombergQuint 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 BloombergQuint.

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

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