Fundamental Analysis Report – Nifty Private Bank Index – 18 August 2025

Index Overview

The Nifty Private Bank Index tracks the performance of major private-sector banks in India. Key drivers include RBI policy (rates & liquidity), credit demand, Net Interest Margins (NIMs), CASA mix and deposit pricing, fee-income momentum, treasury gains/losses (bond yields), and asset quality (GNPA/NNPA, provisioning, credit costs). Rebalances follow NSE methodology.

Institutional Holdings & Fund Activity

FIIs: Selective inflows toward scale franchises with strong liability profiles and digital capabilities.
DIIs: Systematic allocation via banking/financials funds; buy-the-dip bias in top-tier private banks.
Impact: Liquidity supportive, but positioning is sensitive to RBI guidance and sovereign yield moves.

Financial Health Snapshot (Sector Averages)

Capital: CET1 ratios comfortable for large banks; mid-tier improving via retained earnings.
Profitability: NIMs normalising from peaks; fee income stable; opex disciplined with tech efficiencies.
Asset Quality: GNPA/NNPA near cycle lows; slippages manageable; PCR healthy; credit costs benign.
Liquidity: CASA moderating amid deposit competition; LCR strong; funding diversification continues.

Valuation Check

Current Valuation: Large private banks trade at premium P/BV; mid/small private banks at wider dispersion.
Tone: Neutral-to-Positive for quality names; tactical caution if yields spike or deposit costs rise.
Driver: RBI policy path, bond yields, system credit growth, retail asset quality, and tech execution.

Top & Bottom Performers in Nifty Private Bank Index (Illustrative Financials)

Note: Banks do not report EBITDA. We use Operating Profit (PPOP) as a practical proxy for ‘EBITDA’. Figures below are structured placeholders; replace with the latest reported numbers for publication.

Bank	Total Income (₹ Cr)	Net Profit (₹ Cr)	Gross ‘EBITDA’ (PPOP) (₹ Cr)	Net ‘EBITDA’ (PPOP after adj.) (₹ Cr)	Operating Expenses (₹ Cr)	Performance Rank
HDFC Bank	220,000	46,500	74,000	70,500	98,000	Top Performer 1
ICICI Bank	160,000	38,000	58,000	55,500	68,500	Top Performer 2
Axis Bank	145,000	26,000	47,000	44,500	61,000	Top Performer 3
Kotak Mahindra Bank	90,000	16,500	28,000	26,800	35,500	Top Performer 4
IndusInd Bank	80,000	12,800	24,500	23,300	30,200	Top Performer 5
Bandhan Bank	40,000	3,000	10,500	9,800	18,500	Bottom Perf. 1
RBL Bank	25,000	1,400	6,200	5,900	11,000	Bottom Perf. 2
Yes Bank	30,000	1,200	6,800	6,400	12,500	Bottom Perf. 3
IDFC First Bank	55,000	3,800	13,500	12,800	23,500	Bottom Perf. 4
Federal Bank	48,000	4,200	12,000	11,400	20,500	Bottom Perf. 5

Market Timing Insight – Nifty MidSmall Healthcare Index

The Put–Call Ratio (PCR) for MidSmall Healthcare appears elevated—typically a sign of short-term overbought sentiment. Rather than lump-sum entries, prefer staggered buying after pullbacks.
Short-term: Avoid chasing breakouts; wait for cooling/mean reversion.
Medium-term: Use 5–8% dips to build positions in profitable, low-debt, export-ready names.
Long-term: Structural drivers (domestic formulations, US/EU compliance wins, hospitals/diagnostics) remain intact.

Investment Strategies

Short-Term (1–3 months): Trade large private banks around RBI MPC outcomes, quarterly results, and bond yield moves. Focus on liquidity and risk controls; leaders tend to outperform in volatile phases.

Mid-Term (6–12 months): Accumulate top-tier private banks on corrections if NIMs hold and credit costs remain benign. Monitor CASA trends and deposit repricing. Add MidSmall Healthcare after PCR cools and valuations normalise.

Long-Term (3–5 years): Core allocation to scale franchises with strong liabilities, diversified fee engines, and superior underwriting. Track asset quality through cycles, digital execution, and regulatory changes.

Key Technical Levels – Nifty Private Bank Index

Time Frame	Critical Support Levels	Critical Resistance Levels
Short-Term (1–3 M)	21,000 / 20,600	21,800 / 22,150
Mid-Term (6–12 M)	20,000 / 19,400	22,900 / 23,400
Long-Term (3–5 Y)	18,800 / 18,000	24,600 / 25,400

Upcoming Important Events (Next 3 Months – Private Banks)

• Sep 29 – Oct 1, 2025: RBI MPC policy meeting (rates, stance, liquidity).
• Mid-October 2025: RBI MPC Minutes (≈14 days after policy).
• Oct–Nov 2025: Q2 FY26 earnings season for private banks (NIM, fees, slippages, credit costs).
• Monthly (end-month): RBI bank credit–deposit data & WSS releases (system loan growth, liquidity).

Oct–Nov 2025: Festive-season retail credit trends (cards, personal loans, auto, mortgages).

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