Banks Q2 Results Preview: HDFC Bank, ICICI Bank, SBI Is Motilal Oswal's Top Pick Ahead Of Q2 Earnings

For Q2 FY26, Motilal Oswal estimates net interest income for its banking coverage universe to decline 0.9% YoY/1.8% QoQ, while PPoP is also expected to decline 5.5% YoY/14% QoQ). The brokerage estimate private banks’ PAT to decline 7.3% YoY/6.7% QoQ and PSU banks’ PAT to fall 7.1% YoY/1.9% QoQ. .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.For the private banks under our coverage, we estimate pre-provision operating profit to decline 2% YoY/ 18% QoQ and PAT to decline 7.3% YoY/6.7% QoQ in Q2 FY26. We estimate ~19.8% earnings CAGR over FY26-28E for private banks. Estimate NII to grow 0.6% YoY/fall 2% QoQ in 2QFY26. Among large private banks under our coverage, NII growth is estimated at 2.3% YoY (-2% QoQ) for HDFC Bank and 5.5% YoY (-2.3% QoQ) for ICICI Bank, whereas NII is expected to decline by 2.3% YoY/2.9% QoQ for Axia Bank, 4.2% YoY/0.8% QoQ for Kotak Mahindra Bank and 2.3% YoY/1% QoQ for Federal.  Unsecured retail stress shows early signs of easing, but challenges persist in cyclical sectors like CV loans and MSMEs, with credit costs expected to normalize in H2 FY26. Large private banks with more diversified and secured portfolios continue to fare better.We estimate PSU banks’ PAT to decline 7.1% YoY (down 1.9% QoQ) in Q2 FY26E, owing to a decline in NIMs and moderation in treasury gains for most PSBs, barring Punjab National Bank. NII is likely to decline 2.5% YoY (down 1.7% QoQ). Opex is likely to be under control, though treasury gains are expected to moderate as bond yields remain range-bound with some recent up-moves. The upcoming CRR cut and ongoing deposit repricing should aid medium-term margins.Asset quality outlook stable: We expect stable asset quality trends for PSU banks, aided by controlled slippages and robust PCR.We estimate PSU banks to report earnings CAGR of 15.2% over FY26-28E..Click on the attachment to read the full report:.'Buy' Page Industries Shares Maintains Motilal Oswal Despite Rich Valuations — Here's Why.DISCLAIMERThis 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.

Banks Q2 Results Preview: HDFC Bank, ICICI Bank, SBI Is Motilal Oswal's Top Pick Ahead Of Q2 Earnings

The impact of the big 50bp rate cut in Jun’25 on banks’ lending yields will be fully reflected in Q2, while the moderation in CoF will happen with a lag, adds Motilal Oswal.

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