Morgan Stanley on HDFC Bank: Buy rating with a target price of ₹1850. Steady deposit growth YoY. End-of-period deposits rose 5% QoQ, while average deposits grew 3.1%. Retail loans increased by 3% QoQ and 11% YoY, slightly higher than the previous quarter’s 10%. Overall loan growth slowed to 8% YoY from 11%.
Nomura on Bank of Baroda: Buy rating with a target price of ₹280. Pre-Q2 update shows strong loan and deposit growth. Loan growth is up 6.7% QoQ and 11.6% YoY, driven by non-retail and international segments. Retail loans grew 4.4% QoQ and 19.9% YoY.
Morgan Stanley on RBL Bank: Underweight rating with a target price of ₹210. Gross loans grew 2% QoQ and 15% YoY, down from 18% in Q1. Retail loan growth slowed to 2% QoQ, and non-retail loans rose by 2%. Retail deposit growth remained strong at 4% QoQ and 22% YoY. CASA deposits jumped 10% after a 9% drop last quarter.
Morgan Stanley on L&T Finance: Underweight rating with a target price of ₹140. Retail loan growth slowed to 28% YoY from 31% in Q1 due to lower micro and farm finance disbursements. Awaiting more details on margins, credit costs, and asset quality for Q2.
Jefferies on IndusInd Bank: Buy rating with a target price of ₹1750. Q2 pre-update shows stable deposit growth of 15% YoY. Retail deposit growth was steady at 16% YoY. Loan growth slowed to 13% YoY, down from 20% in December 2023, likely due to the need to reduce the loan-to-deposit ratio (LDR).
UBS on Sun Pharma: Buy rating with a target price of ₹2450. Specialty products will contribute over 30% of profits in three years, potentially driving a re-rating. Strong cash flow and upcoming generic launches like Lanreotide and Tolvaptan are expected to boost performance.
Morgan Stanley on Federal Bank: Underweight rating with a target price of ₹185. Deposit growth slowed to 1% QoQ compared to 5% last quarter. Customer deposits grew 1% QoQ and 16% YoY. Loan growth rose 4.3% QoQ and 19.3% YoY, with a slight increase in the loan-to-deposit ratio to 86.9%.
Nomura on AU Small Finance Bank: Neutral rating with a target price of ₹650. Pre-Q2 update shows strong loan and deposit growth. Loan-to-deposit ratio declined by 570 basis points to 87.5%. CASA deposits grew 10.9% QoQ, with the CASA ratio reaching 32.4%.
Jefferies on Bandhan Bank: Buy rating with a target price of ₹240. Loans grew 21% YoY and 4% QoQ, rebounding from a low base. Deposits increased by 27%, with bulk deposits up 58%. LDR fell by 260 basis points QoQ to 92%, which could limit short-term loan growth.
Nomura on MacroTech Developers: Buy rating with a target price of ₹1600. Q2 collections were ₹31 billion, up 12% YoY and 14% QoQ. Net debt rose to ₹49 billion, but the debt-to-equity ratio remained below 0.5x.
Jefferies on Financials (RBI Proposal): RBI’s proposed norms would require subsidiaries to be classified as upper-layer NBFCs, leading to increased scrutiny and potential listing requirements, impacting banks like Axis, HDFC, Kotak, and Federal Bank.
Citi on Financials (RBI Circular): The RBI’s draft circular proposes that only one entity in a bank group should handle each business type, and total equity investments should not exceed 20% of capital and reserves.
