According to reports from CNBC TV18, Mayuresh Joshi, Director of Research at Marketsmith India, favours South-based private sector lenders like Karur Vysya Bank over RBL Bank. While RBL Bank delivered a decent quarterly performance, management is expected to remain cautious over the next couple of quarters before turning aggressive in 2027 and 2028. Karur Vysya Bank offers better consistency, with its agricultural exposure well-covered rather than being completely unsecured, which mitigates asset quality fears. Joshi noted that there needs to be some element of clarity in all the issues surrounding the bank itself.
As reported by CNBC TV18, channel checks across the micro, small and medium enterprises (MSME) and microfinance space indicate potential struggles over the next couple of quarters. Three primary headwinds face the sector: a rising interest rate scenario that could accelerate stress in restructured books, payout risks in the unsecured loan portion, and recent changes to insurance commissions that could negatively impact lower-ranked non-banking financial companies (NBFCs). Large leadership NBFCs are expected to survive the cycle, but mid-tier and microfinance players face a tougher environment.
According to CNBC TV18, Bandhan Bank, which has corrected from ₹210 to the ₹150-₹160 level near its 52-week low, remains a clear underperformer. Joshi explained that there needs to be some element of clarity in all the issues surrounding the bank itself. The research director noted that Bandhan Bank faces challenges due to ongoing regulatory and operational concerns.
As reported by CNBC TV18, HCLTech maintained its 2.5% guidance for cost and currency while holding earnings before interest, taxes, depreciation, and amortisation (EBITDA) margins at 17.5% to 18.5%. The company also reported a record order book and fast growth in advanced artificial intelligence (AI). Joshi noted that HCLTech had a very decent set of numbers among the large names that reported yesterday, despite broader global conditions and fears of an AI deflation trade.
According to CNBC TV18, despite strong performance, global conditions and fears of an AI deflation trade alongside cuts in global spending pose risks. Referencing recent commentary from Satya Nadella on the need for a human emergency break in the AI ecosystem, the broader global setup may not be supportive for large-cap technology names. This creates a challenging environment for technology companies despite individual company strengths.
