Banks, Insurance Q3 Preview - Earnings Progression On Track: Motilal Oswal

BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Motilal Oswal Report.Systemic loans exhibit a consistent revival, with strong credit growth at 17.4% YoY in December 2022 (nine-year high), driven by continued traction in the retail and small and medium enterprise segment. The corporate segment is also seeing recovery. Home, vehicle, unsecured, and small business continue to do well, while demand for commercial vehicle is also improving. The credit cards business is seeing a healthy momentum, with spends growing at a robust pace. Any change in the demand environment needs to be monitored, given-the challenging macro situation,a moderation in inflation, and,a high base effect. We estimate a ~15% compound annual growth rate in systemic loans over FY23-24. Deposit rates have increased sharply over the past few months, aiding liability accretion, though the gap versus credit growth still remains large. While we expect a positive bias in margins in Q3 FY23, the rise in the cost of deposits would be a key factor to assess the margin trajectory in FY24. Margins may see some pressure in FY24, in our view..Click on the attachment to read the full report:.DISCLAIMERThis report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Banks, Insurance Q3 Preview - Earnings Progression On Track: Motilal Oswal

Credit growth remains buoyant; estimate 15% CAGR over FY23-24; deposit accretion gaining traction.

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