Shares of HDFC Bank and ICICI Bank traded higher in early trade on July 21 after both lenders reported their Q1 earnings over the weekend. The two banking giants, among the most valuable in the country, posted results that drew investor interest at the start of the session.
HDFC Bank share price jumped as much as 2.27 per cent to an intra day high of Rs 2,001.90 apiece on the NSE. ICICI Bank share price surged up to 2.75 per cent to an intraday high of Rs 1465 per share on the NSE.
Both stocks are hovering near their respective 52-week highs and were among the top contributors supporting the benchmark indices. Their gains helped offset pressure on the Sensex and Nifty 50 in trade today, which were dragged lower by a more than 2.5 per cent decline in Reliance Industries.
HDFC Bank Q1 Results
HDFC Bank reported a 12 per cent year-on-year (YoY) growth in standalone net profit at Rs 18,155 crore for Q1 FY26, as against Rs 16,175 crore in the same quarter last year.
Interests earned during the quarter was Rs 77,470 crore, up 6 per cent from Rs 73,033 crore in the year-ago period.
Net interest income (NII) came in at Rs 31,440 crore, a 5.4 per cent increase from Rs 29,840 crore in Q1FY25. The bank's core net interest margin (NIM) stood at 3.35 per cent on total assets, down from 3.46 per cent in the previous quarter.
The bank’s Board of Directors also announced the issuance of the bank’s first-ever bonus shares, in the ratio of 1:1. That means, eligible shareholders will receive one additional share for each share they own. The Board also declared an interim dividend of Rs 5 per share.
HDFC Bank Q1 Results: What Brokerages Say
According to Axis Securities, HDFC Bank's credit growth has been slower than the broader market due to its decision to reduce its loan-to-deposit ratio (LDR). With the LDR now under 100 per cent, the bank plans to align its growth with the overall market in FY26 and expects to outpace systemic growth by FY27, the brokerage said.
“The management has identified segments to drive this growth, with the retail portfolio, particularly non-mortgage segments, poised for a strong growth uptick. This growth will be driven by a pick-up in consumption demand on the back of tax rate cuts and improved demand during the festive season. The mortgages segment continues to face rising pressures, especially from PSBs; however, the bank will look at accelerating growth from H2 FY26 onwards,” said the brokerage.
Axis Securities expects the bank to achieve a 14 per cent compound annual growth rate (CAGR) in advances from FY25 to FY28, compared to a 17 per cent CAGR in deposits over the same period. As a result, the LDR is projected to improve to around 88 per cent by FY28, close to pre-merger levels.
ICICI Bank Q1 Results
ICICI Bank reported a standalone net profit of Rs 12,768 crore for the June quarter, a 15.5 per cent YoY increase from Rs 11,059 crore in the same period last year.
NII grew 10.6 per cent YoY to Rs 21,634.46 crore, while the NIM slightly dipped from 4.41 per cent in the previous quarter to 4.34 per cent.
The bank’s core operating profit saw a 13.6 per cent YoY jump to Rs 17,505 crore for Q1 FY26.
ICICI Bank Q1 Results: What Brokerages Say
Brokerage firm Motilal Oswal said, “ICICI Bank’s results epitomise the saying, ‘When the going gets tough, the tough get going’. Over the past few years, irrespective of the sectoral challenges such as unsecured asset quality issues, systemic growth moderation, liability accretion or NIM headwinds, the bank has been able to deliver a stellar performance, beating Street expectations.”
During Q1 FY26, the controlled NIM decline of 7 basis points was another solid beat in that series, compared to a double-digit contraction reported by many peers, said the brokerage firm.
The brokerage noted that ICICI Bank continues to prioritise superior risk-adjusted returns, supported by “prudent underwriting and strong credit discipline”.
Motilal Oswal maintained its earnings estimates and expects ICICI Bank to deliver a return on assets (RoA) of 2.3 per cent and return on equity (RoE) of 17.3 per cent in FY27.
