Bank financial stocks fall: HDFC twins, Bajaj FinServ top losers


Axis Bank, HDFC Bank and ICICI Bank are down over a percent each while HDFC has fallen more than 2 percent.

The Indian stock market continues to trade in the red but is off day’s low. At the time of writing this copy, Sensex was down 354.27 points, or 0.69 percent, at 51,090.38, and the Nifty shed 97.60 points, or 0.64 percent, at 15,148.

The fall in the market is largely due to weakness inĀ bank and financial stocks.

Bank Nifty is down a percent dragged by Axis Bank, HDFC Bank and ICICI Bank which are down over a percent each.

Nifty Financial ServicesĀ is also down over a percent with HDFC stock shedding over 2 percent followed by Bajaj Finserv, HDFC Life, Mahindra & Mahindra Financial Services and Shriram Transport Finance Corporation.

Global research firm Morgan Stanley said it prefers State Bank of India from the PSU banking basket and is overweight on the stock with target of Rs 600 per share. However, its sees continued structural challenges at others, limiting rerating, according to a CNBC-TV18 report.

It feels that valuations are cheap and hence it has upgraded Bank of Baroda and Punjab National Bank to equal-weight with target raised in Bank of Baroda to Rs 100 from Rs 65 per share and for PNB to Rs 48 from Rs 35 per share.

It, however, stays underweight on Bank of India and Canara Bank given the low profitability.

Vineeta Sharma, Head of Research at Narnolia Financial Advisors has recommended buy on ICICI Bank with target at Rs 700. “Advance growth, led by retail and MSME segments, was strong during the quarter. On the asset quality front, pro-forma GNPA and NNPA did not witness a big increase QoQ and on the provisioning front,” she said.

“The bank is holding a contingency provision of Rs 9,984 crore and believes it should act as a cushion against future shocks and thus expect normalisation of credit cost in FY22,” she added.

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Sandip Das