Midcap private banks lead market surge with double-digit gains: Report
New Delhi, July 16
India's midcap private-sector banks clocked double-digit gains in the June quarter. All seven private-sector banks in the top 20 with market capitalisations below Rs 1 trillion posted double-digit gains in the three months ended June 30, as per S&P Global Market Intelligence data report.
The midcap lenders emerged as the biggest gainers in a broader stock market rally that followed a temporary ceasefire between Iran and the US.
As per the report, "Yes Bank Ltd.'s market cap rose about 40% quarter over quarter, while IDBI Bank Ltd. gained 35.8%."
This marked a recovery for IDBI Bank Ltd., which bounced back from a 40 per cent decline in the previous three months after the government halted its divestment process.
The data noted that Mumbai-based RBL Bank Ltd. entered the top 20 ranking after its market capitalization surged 219 per cent to Rs 571.5 billion.
Large-cap private banks also registered growth. HDFC Bank Ltd., the country's largest lender by market capitalization, saw its market value rise 9.13 per cent during the quarter. This increase followed a 26 per cent decline in the January-to-March period.
Meanwhile, ICICI Bank Ltd. gained 14.19 per cent, reclaiming its position as India's second-largest bank by market cap from State Bank of India. Axis Bank Ltd. and Kotak Mahindra Bank Ltd. also recorded growth, rising 15.9 per cent and 11.3 per cent, respectively.
State-owned banks, meanwhile, underperformed the broader rally, with most posting sub-10 per cent gains. State Bank of India rose 4.85 per cent, while Bank of Baroda Ltd. gained about 10 per cent. Punjab National Bank grew by 6.1 per cent, and Canara Bank registered a 1.7 per cent increase.
Indian Bank was the only lender among the top 20 to post a decline, with its shares falling 3.44 per cent during the quarter. Other public sector lenders like Indian Overseas Bank and Bank of India Ltd. recorded lower gains at 8.6 per cent and 2.5 per cent, respectively.
Data from the report showed that the aggregate market capitalization for the top 20 Indian banks stood at Rs 53,135.42 billion at the end of the June quarter.
— ANI
Reader Comments
Interesting how the private banks are outperforming PSU banks. HDFC and ICICI are still the safe bets, but RBL Bank's 219% surge is mind-blowing! 🚀 Though I wonder if this is sustainable or just market euphoria.
While I'm happy for the gains, there's something concerning about PSU banks lagging behind. The government needs to address their NPAs and governance issues. Canara Bank and Indian Bank should not be falling when the market is rallying.
Yah, my relatives who invested in IDBI Bank are finally smiling after that 35% gain! 😅 But I hope the government doesn't mess up the divestment process again. We need stability in the banking sector for long-term growth.
The Iran-US ceasefire seems to have sparked this rally across emerging markets. But I'd be careful – geopolitical tensions are far from over. Midcap banks might be the biggest gainers now, but they could also fall hardest if sentiment shifts.
I'm not surprised about private banks outperforming – they're more efficient and have better technology. PSU banks need to modernize their operations. But still, a 40% jump in Yes Bank? That's risky for conservative investors. 🤔
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