Banking, Finance & Insurance Sector – Q3 FY20 Results Analysis
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In this article, you will get the latest quarterly result updates of Banking, Finance and Insurance sector companies comprising in NIFTY 200. Updated as on 11th Feb, 2020.
Banking & Financial Sector Analysis
Introduction
In this article, you will get the latest quarterly result updates of Banking, Finance and Insurance sector companies comprising in NIFTY 200. Updated as on 11th Feb, 2020.
We have already covered the Ready Reckoner of NIFTY 200 Stocks Q3 FY2019-20 results in our earlier article.
Here, the percentage growth year-on-year (YoY%) as well as quarter-on-quarter (QoQ%) for the Market Capitalization (Mkt Cap), Revenue and Net Profit (PAT) of Banking, Finance and Insurance sector companies in NIFTY 200 is given.
| Sr. No. | Company Name | Industry | Mkt Cap QoQ% | Mkt Cap YoY% | Revenue YoY% | Revenue QoQ% | PAT YoY% | PAT QoQ% |
| 1 | AU Small Finance Bank Ltd. | Bank – Private | 26% | 33% | 8% | 41% | 11% | 100% |
| 2 | Axis Bank Ltd. | Bank – Private | 10% | 31% | 2% | 11% | NA* | 7% |
| 3 | Bandhan Bank Ltd. | Bank – Private | 44% | 22% | 1% | 65% | -25% | 121% |
| 4 | City Union Bank Ltd. | Bank – Private | 11% | 21% | ||||
| 5 | HDFC Bank Ltd. | Bank – Private | 3% | 20% | 4% | 14% | 15% | 30% |
| 6 | ICICI Bank Ltd. | Bank – Private | 27% | 48% | 2% | 17% | 223% | 129% |
| 7 | IDBI Bank Ltd. | Bank – Private | 63% | -9% | ||||
| 8 | IDFC First Bank Ltd. | Bank – Private | 19% | 6% | 2% | 13% | NA* | NA* |
| 9 | IndusInd Bank Ltd. | Bank – Private | 14% | 7% | 2% | 26% | -7% | 33% |
| 10 | Kotak Mahindra Bank Ltd. | Bank – Private | 2% | 34% | -1% | 8% | -3% | 28% |
| 11 | RBL Bank Ltd. | Bank – Private | 37% | -28% | 2% | 36% | 24% | -70% |
| 12 | The Federal Bank Ltd. | Bank – Private | 1% | -4% | 2% | 14% | 6% | 33% |
| 13 | Yes Bank Ltd. | Bank – Private | 46% | -72% | ||||
| 14 | Bank Of Baroda | Bank – Public | 34% | 44% | 0% | 46% | NA* | NA* |
| 15 | Bank Of India | Bank – Public | 15% | 25% | 2% | 7% | -58% | NA* |
| 16 | Canara Bank | Bank – Public | 70% | 11% | 0% | 0% | 0% | 14% |
| 17 | Indian Bank | Bank – Public | 6% | -49% | 3% | 13% | -31% | 62% |
| 18 | Punjab National Bank | Bank – Public | 61% | 44% | 2% | 6% | -217% | -304% |
| 19 | State Bank Of India | Bank – Public | 31% | 12% | 5% | 9% | 86% | 41% |
| 20 | Union Bank Of India | Bank – Public | 108% | 81% | 2% | 14% | NA* | 261% |
| 21 | HDFC Asset Management Company Ltd. | Finance – Asset Management | 16% | 110% | 5% | 10% | -4% | 45% |
| 22 | Nippon Life India Asset Management Ltd. | Finance – Asset Management | 34% | 123% | 1% | -13% | 9% | 36% |
| 23 | Housing & Urban Development Corporation Ltd. | Finance – Housing | 12% | -14% | -12% | 37% | -72% | -37% |
| 24 | Housing Development Finance Corporation Ltd. | Finance – Housing | 22% | 22% | -12% | 18% | -73% | -8% |
| 25 | Indiabulls Housing Finance Ltd. | Finance – Housing | 17% | -63% | -1% | -20% | -22% | -44% |
| 26 | LIC Housing Finance Ltd. | Finance – Housing | 14% | -11% | 0% | 12% | -22% | -1% |
| 27 | PNB Housing Finance Ltd. | Finance – Housing | -24% | -52% | -7% | 0% | -35% | -22% |
| 28 | Bajaj Finserv Ltd. | Finance – Investment | 11% | 44% | 2% | 31% | -2% | 39% |
| 29 | Aditya Birla Capital Ltd. | Finance – NBFC | 31% | 7% | 9% | 14% | 4% | 14% |
| 30 | Bajaj Finance Ltd. | Finance – NBFC | 11% | 67% | 11% | 41% | 7% | 52% |
| 31 | Bajaj Holdings & Investment Ltd. | Finance – NBFC | -6% | 14% | -26% | -21% | -51% | -45% |
| 32 | Cholamandalam Investment & Finance Company Ltd. | Finance – NBFC | 3% | 21% | 3% | 24% | 27% | 22% |
| 33 | Edelweiss Financial Services Ltd. | Finance – NBFC | 14% | -40% | ||||
| 34 | L&T Finance Holdings Ltd. | Finance – NBFC | 42% | -23% | 1% | 8% | 239% | 2% |
| 35 | Mahindra & Mahindra Financial Services Ltd. | Finance – NBFC | 3% | -30% | 5% | 13% | 83% | 15% |
| 36 | Manappuram Finance Ltd. | Finance – NBFC | 32% | 92% | 9% | 30% | -1% | 63% |
| 37 | Muthoot Finance Ltd. | Finance – NBFC | 13% | 49% | ||||
| 38 | Shriram Transport Finance Company Ltd. | Finance – NBFC | 9% | -7% | -2% | 5% | 15% | 38% |
| 39 | Max Financial Services Ltd. | Finance – Others | 29% | 22% | 15% | 2942% | 129% | 5% |
| 40 | Indiabulls Ventures Ltd. | Finance – Stock Broking | 87% | -46% | 11% | 53% | -23% | -14% |
| 41 | Power Finance Corporation Ltd. | Finance Term Lending | 24% | 10% | ||||
| 42 | REC Ltd. | Finance Term Lending | 16% | 19% | 2% | 4% | 26% | 31% |
| 43 | General Insurance Corporation of India Ltd. | Insurance | 0% | -12% | -33% | 14% | NA* | NA* |
| 44 | HDFC Life Insurance Co Ltd. | Insurance | 4% | 61% | 5% | 14% | -19% | 3% |
| 45 | ICICI Lombard General Insurance Co Ltd. | Insurance | 15% | 59% | 4% | 16% | -4% | 23% |
| 46 | ICICI Prudential Life Insurance Company Ltd. | Insurance | 3% | 48% | 1% | 9% | 0% | 2% |
| 47 | SBI Life Insurance Company Ltd. | Insurance | 18% | 63% | 16% | 28% | 200% | 47% |
| 48 | The New India Assurance Co. Ltd. | Insurance | 27% | -25% | 5% | 12% | -8% | NA* |
| Average Banking, Finance & Insurance Sector | 8% | 10% | 1% | 16% | 0% | 43% |
Note : *The companies were in losses in any one of the periods considered for calculation purpose and hence percentage change cannot be calculated in such cases.
Sector Update – Banking, Finance and Insurance
Banking, Finance and Insurance sector is in focus after recovery from IBC resolutions increasing earnings, improvement in asset quality, low slippages and better ratios. Loan growth still is a bit disappointing as seen from RBI’s macro data.
Key Findings
- SBI, ICICI Bank are the outliers as their recoveries are higher than 90% from entities like Essar Steel, Ruchi Soya, Prayagraj Power and some mid-sized accounts.
- Most large private sector banks have full tax benefit coming into the earnings, as they fully marked down DTA (deferred tax assets) last quarter.
- Slippages in accounts like DHFL, Cafe Coffee Day (CCD), Cox & Kings etc has washed out positive impact of IBC resolutions to an extent. Most of the banks reported a sharp rise in slippages, especially from the corporate loan book.
- The banks also have to create provisions for exposure to Telecom sector looking at the stress that is build up.
- It can be clearly observed from the numbers that the credit growth has considerably slowed down in this quarter and could have impact on margins/earnings. The average revenue growth for this sector was just 1.8% QoQ and around 15.1% YoY. Weak vehicle sales and moderate housing volumes could be reasons for this.
- Most of this is driven by growth is retail loans at around 16% YoY. So, retail growth shouldn’t worry most of the banks.
- HDFC Ltd has recognized a fair value gain of Rs.90 Billion on de-recognition of investment in GRUH in Q3 FY20.
- Kotak Mahindra Bank’s changing mix towards retail is helping improve overall margin improvement.
- Among AMCs, HDFC AMC is the largest in terms of size. It is noteworthy that Nippon AMC has been able to stop the decline in AUM.
- Merger benefit are gradually flowing in with Bank of Baroda currently on Operating Expenditure (OPEX), while other parameters continue to be low especially loan growth, margins and provisions.
- Talking about NBFCs, funding still is a challenge and growth has been affected due to this, though large players continue to enjoy a disproportionate access to funds.
- As competition from banks exists, growth in the core home loan has remained a challenge for Housing Finance Companies (HFCs).
- Most of the insurance companies have posted a flat growth this quarter except SBI, whose profit jumped about 47% YoY.
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