Kotak says bank earnings may rise 20% in Q2 on lower provisions
In short
Kotak said Indian banks could see earnings rise 20% in Q2. It pointed to lower provisions and stronger income growth as the main supports.
The note says private banks may grow faster than public sector banks, and that banks could also benefit from a rising interest-rate cycle and a better loan mix.
What the reporting says
Kotak said Indian banks are projected to see 20% earnings growth in Q2, supported by lower provisions and healthy income growth. The note also said banks may benefit from a rising interest-rate cycle and a favorable loan mix in coming quarters. Private banks are expected to lead earnings growth over public sector banks, according to the outlook.
Why it matters
Kotak projected that Indian bank earnings could rise 20% in Q2, helped by lower provisions and stronger net interest income. The outlook also said banks may benefit from a rising interest-rate cycle and a favorable loan mix in the next quarters. Private banks are expected to outperform public sector banks in earnings growth, based on the note’s sector view.