The financial stocks have been in focus. The Nifty Bank Index is up 4% in last 5 trading sessions. The Nifty Financial Services Index also clocked similar gains in the last 5 trading sessions. Global brokerage firm Jefferies is betting big has shared its insights on six key financial stocks. Covering banks, life insurers, fintech, and exchanges, the report highlighted the growth prospects of these companies, the challenges, and regulatory impact.
Let’s take a look at what Jefferies had to say about HDFC Bank, IDFC First Bank, HDFC Life, ICICI Prudential Life, Paytm, and BSE.
Jefferies on HDFC Bank: Focus on deposit growth and stronger loan expansion
HDFC Bank remains optimistic about its future trajectory, with deposit growth expected to reach approx. 15% next year, as per the brokerage report. This, combined with a reduced need to moderate its loan-to-deposit ratio (LDR), is likely to help the bank push credit growth closer to the industry average in FY26 and surpass it in FY27.
According to Jefferies, “asset quality remains stable, and the brokerage notes that the Reserve Bank of India’s (RBI) supportive policies on liquidity and regulations should act as key enablers for the bank.”
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“HDFC Bank was confident about the ability to grow deposits by 15% next year as it gains share in the system,” added the brokerage in its report.
Jefferies on IDFC First Bank: MFI a worry but strong growth in other segments
IDFC First Bank is facing near-term pressure in its Microfinance (MFI) segment, with higher credit costs expected to impact profits in Q4. However, collection efficiency has shown some improvement, and the bank anticipates a gradual easing of this burden going forward.
Furthermore, the brokerage noted that, “High credit costs in MFI segment will drag profits in Q4 and should ease incrementally thereafter.”
Jefferies on HDFC Life & ICICI Pru Life: Regulatory uncertainty looms
For life insurers, the brokerage house notes that the industry is awaiting clarity on bancassurance norms, which could be finalised in the coming months. Insurers may be given a few years to comply if a cap is introduced.
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