India’s Private Banks Report Varied Q2 FY27 Earnings
HDFC Bank, ICICI Bank, and Axis Bank recorded significant profit growth for the quarter ending 30 September 2026, while Yes Bank's profit surged and IDBI Bank saw a decline.
Leading Lenders Show Strong Profit Growth
Three of India’s largest private lenders, HDFC Bank, ICICI Bank, and Axis Bank, reported robust profit increases for the quarter ending 30 September 2026 (Q2 FY27). HDFC Bank’s net profit climbed 4.6% year-on-year to ₹19,510 crore. Its net interest income (NII), the difference between interest earned and expended, grew 9.7% to ₹34,620 crore.
ICICI Bank recorded a 20.1% rise in standalone net profit, reaching ₹14,843 crore, with its NII expanding 17.7% to ₹25,339 crore. Axis Bank reported a 37.6% jump in net profit to ₹7,003.3 crore, alongside an 11.8% increase in NII to ₹15,371.4 crore, surpassing analyst estimates.
Margins and Asset Quality Diverge
Net interest margins (NIMs) and asset quality varied among the banks. HDFC Bank posted a NIM of 3.16% on total assets. Seema Srivastava, Senior Research Analyst at SMC Global Securities, highlighted HDFC Bank's 39.1% cost-to-income ratio and 1.11% gross non-performing assets (GNPA).
ICICI Bank achieved a sector-leading NIM of 4.18%, though it contracted by 12 basis points sequentially. Axis Bank’s NIM stood at 3.36%, with its gross NPA ratio improving to 1.16% from 1.46% a year earlier. Srivastava noted Axis Bank’s stable execution and controlled credit costs, despite a comparatively lower CASA ratio of 36%.
Mixed Fortunes for Other Banks
YES Bank saw its net profit surge 65% year-on-year to ₹1,080 crore, with NII rising 22.7% to ₹2,822.5 crore. Its NIM improved to 2.6% from 2.5% a year ago, but declined from the prior quarter. However, SMC Global Securities’ Srivastava pointed to significant risks for YES Bank stemming from a Supreme Court ruling that upheld an ₹8,415 crore AT-1 bond write-down.
In contrast, IDBI Bank reported a 39.2% year-on-year drop in net profit to ₹2,206 crore. Despite this profit decline, the bank’s NII increased by almost 29%, and its NIM showed significant improvement, alongside better asset quality.
For investors seeking long-term capital stability, SMC Global Securities recommends ICICI Bank and HDFC Bank, citing their strong balance sheets and diversified earnings. Axis Bank offers a balanced risk-reward profile for core holdings.
Sugandha Sachdeva, Founder of SS WealthStreet, identified ICICI Bank as a top stock, noting its encouraging Q2 FY27 performance and constructive technical structure, showing recovery from ₹1,290 earlier this month. IDBI Bank may appeal to tactical investors watching for privatisation catalysts. However, caution is advised for YES Bank until the financial impact of the AT-1 bond judgment becomes fully clear.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
Comments.
Comments are moderated. We remove what is unlawful, abusive or off-topic, and and you remain responsible for what you post.
Reader comments open soon. Until then, corrections and responses go to our newsroom, and we publish what we get wrong on Corrections.