BFSI Q3 Results Preview – Earnings Growth To Remain Strong: Axis Securities
Banks that reported their provisional numbers for Q3FY23, witnessed a sequential improvement in deposit growth.
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Axis Securities Report
Banks - The credit growth momentum has continued to remain robust as is visible from the near decadal high systemic growth of ~17% YoY, driven by the continued traction in the retail and small and medium enterprise segments. On a segmental basis, home loans, auto loans and credit card outstanding continue to grow well. Corporate loans are showing gradual recovery, albeit on a weaker base.
Microfinance – The focus in the microfinance segment continues to remain on accelerating growth, driven by strong new customer acquisition. Assets under management growth is expected to remain healthy for CreditAccess Grameen Ltd. and remain within the guided range at ~25% YoY.
Small Finance Banks - Disbursement growth momentum continued to remain strong, translating into healthy advances growth. For the SFBs under our coverage, the traction on liability franchise continued to remain strong with term deposits outpacing current account and savings account deposits growth.
Diversified Financials – Life insurance, credit cards, broking some part of the festive season spends will reflect in the spends growth for credit card issuers like SBI Cards and Payment Services Ltd. The new customer additions have been progressing well with SBI Cards adding 300,000 plus customers (net) every month.
NBFCs – The disbursement momentum for affordable housing financiers is likely to sustain, translating into healthy AUM growth. Our expectations of robust growth are supported by improving affordability and encouraging credit trends despite inflationary pressures and increasing interest rates.
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