(Reuters) -Shares of HDFC Bank and ICICI Bank, India’s top private lenders by market capitalisation, gained more than 2% on Monday, after quarterly results inspired confidence about their ability to maintain healthy loan growth.
HDFC Bank and ICICI Bank, among the heaviest stocks on the benchmark Nifty 50, were trading 2% and 2.4% higher, respectively, at 9:49 a.m. IST.
They drove the banks and private banks’ indexes higher by 0.6% while the Nifty was trading flat.
On Saturday, both lenders reported their June quarter profits that beat analysts’ estimates as healthy loan growth boosted core lending income.
At least six analysts hiked their price targets on HDFC Bank while nine raised targets for ICICI Bank’s shares, according to data compiled by LSEG. Both stocks are rated “buy” on average.
Nomura analysts expect HDFC Bank’s loan growth to catch-up with peers this fiscal year while ICICI Bank is their “top pick” in the sector due to its sector-leading delivery on all metrics.
Analysts at ICICI Direct said HDFC is entering a “renewed phase of growth,” backed by improved liquidity, strong capital buffers and a diversified lending franchise.
The shares of both the banks have risen about 12% so far this year, compared with nearly 11% gains for the banks and private banks indexes. The Nifty 50 index has climbed 5% this year.
(Reporting by Kashish Tandon in Bengaluru; Editing by Mrigank Dhaniwala)
