Indian banks are expected to report a steady profit rise in the January-March quarter, aided by credit growth and liquidity buffers. Four brokers indicated that private banks are likely to report about 8%-12% on-year profit rise, with HDFC Bank and ICICI Bank scheduled to post their results on April 18. State-run lenders may report an advance of about 2%, similar to the previous two quarters.
Private banks’ higher core operating income should cushion margin pressure, while bond yields are expected to weigh more heavily on state-run banks’ treasury gains. Loan demand picked up in the third quarter after a slow start to the fiscal year 2026. The government’s move to cut goods and services tax encouraged spending, while the Reserve Bank of India’s slashing of the cash reserve ratio gave banks more money to lend.
HDFC Bank posted a loan growth of 12% in the March quarter, while ICICI Bank and State Bank of India could log 14.2% and 14.5%. Broker Vishal Narnolia estimated banks to post around 12% to 13% loan growth in FY2027. However, yields hardened in the March quarter, limiting banks’ profitability. Curbs on forex arbitrage further limited trading income at larger lenders.
The bank index fell 15.6% in the March quarter, slightly more than the 14.5% drop in the benchmark Nifty 50 index.
