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Informist, Wednesday, Jan. 22, 2025

MUMBAI – Shares of Indian and Chinese banks are falling short of their target prices by the widest margins amongst peers in the Asia-Pacific region, data compiled by S&P Global Market Intelligence shows. State Bank of India, HDFC Bank, and ICICI Bank feature on the S&P arm's list of 20 lenders from the Asia-Pacific region.

S&P Global Market Intelligence said the relatively slow economic growth in India had taken a toll on shares of banks recently. The Nifty Bank Index has fallen more than 10% from its peak in September. As per the advance estimate released by the statistics ministry, India's GDP growth is seen at a four-year low of 6.4% in the current financial year ending March. In the quarter ended September, the GDP growth fell sharply to a seven-quarter low of 5.4%.

The gap between the share price of State Bank of India, the country's largest lender, and the target price is the biggest at 27.4% and a buy strength of 73.8%, data shows. Shares of the bank Wednesday closed at INR 753.45 on the National Stock Exchange, down 0.7% from Tuesday. The bank is yet to announce its financial results for the quarter ended December.

HDFC Bank is ranked third on the list with an upside to target price of 20.7%. It has a buy strength of 82.5%. The bank announced its Oct-Dec earnings Wednesday, with net profit up just 2.2% on year at INR 167.36 billion, the lowest growth in at least 36 quarters. Shares of the bank ended at INR 1,666.05 on NSE, up 1.4% from the previous close.

ICICI Bank is ranked fifth on the list with its upside to target price at 19.7% and a buy strength of 90.2%, as per the data. Shares of the bank closed 0.4% up at INR 1,200.45 on NSE. The bank is yet to announce its financial results for Oct-Dec. 

"Upside to price target refers to the implied percentage change between the current share price and the consensus price targets as reported by Market Intelligence. Buy strength reflects the percentage of buy and overweight recommendations relative to the total number of recommendations. The Market Intelligence data was based on lenders covered by three or more analysts," S&P Global said.  End

Reported by Ashna Mariam George 

Edited by Subhojit Sarkar

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