“Negative valuations, even private banks like HDFC, ICICI r trading at 2 times book and P/E multiple of 12-15 times. Due to FII selling, it may remain under near-term pressure, banks offer great value, even some NBFCs. Also banks shifting from LDR to LCR offer opportunity to increase credit to book by 3-7%,” said Chaha 7% to increase credit to book. does
Negative valuations, even private banks like HDFC, ICICI trade at 2 times book and P/E multiple of 12-15 times.
Due to FII selling, it may remain under near-term pressure, with banks offering huge valuations, even some NBFCs.
Also banks moving from LDR to LCR offer an opportunity to increase…
— Gurmeet Chadha (@connectgurmeet) March 12, 2026
Chadha said he expects a 3% to 7% increase in credit on banks’ books on the back of the switch to LCR. LDR shows how much of a bank’s reserves are used to make loans while LCR measures whether a bank has enough high-quality liquid assets to survive a stress scenario.
Private Bank Nifty has fallen more than 10% in the same period compared to Nifty’s nearly 8% slide in the last month.
Individually, HDFC Bank and ICICI Bank fell 10% and 11% respectively. IDFC First Bank remained the top loser with a share price of 21% followed by a 12% drop in Kotak Mahindra Bank.
Others including YES Bank, Axis Bank, The Federal Bank and RBL Bank are down between 6% and 8%.
In the 10-stock index, Bandan Bank’s sole gainer has grown 5% over the same period.
Meanwhile, Nifty PSU Bank fell 4% over the month, with Punjab and Sindh Bank (PSB) emerging as the top loser with a 12% decline. Others like State Bank of India (SBI), UCO Bank, Bank of India (BoI), Indian Overseas Bank (IoB), Punjab National Bank (PNB), Canara Bank, Central Bank of India and Bank of Baroda (BoB) fell in single digits up to 9%.
State-owned banks whose shares have grown include Bank of India (3%), Bank of Maharashtra (2%) and Union Bank of India (1%).
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(Disclaimer: The suggestions, recommendations, views and opinions given by the experts are their own. They do not represent the views of The Economic Times.)
