External broker reports(aggregated public sources), Axis Direct

Axis Direct

External broker reports(aggregated public sources)

Axis Direct is the flagship brand under Axis Securities Limited, a subsidiary of Axis Bank in India. 

Content available is external broker reports authored by a third party outside the Smartkarma network and has been aggregated by an online aggregator through publicly available sources and is displayed by Smartkarma in this format for user's convenience and general informational purposes only. Content does not constitute investment or financial advice and Smartkarma makes no representation or warranty regarding its accuracy or contents. Original third party author retains all copyright and other proprietary rights in the content. Access or use of third party links not controlled by Smartkarma are at the user's own risk.

Thematic (Sector/Industry)

<ul><li>The systemic credit growth (as of 13th June, 2025) has derailed to &lt;10%.</li><li>This can be attributed to a meaningful slowdown in the unsecured loans amidst continued asset quality challenges alongside banks, mainly private banks, intending to bring down their LDRs to a balanced level.</li><li>We expect the bank under our coverage to deliver ~11% YoY credit growth, marginally ahead of industry growth. </li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

The systemic credit growth (as of 13th June, 2025) has derailed to &lt;10%.This can be attributed to a meaningful slowdown in the unsecured loans amidst continued asset quality challenges alongside banks, mainly private banks, intending to bring down their LDRs to a balanced level.We expect the bank under our coverage to deliver ~11% YoY credit growth, marginally ahead of industry growth. Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Q1FY26 Earnings Preview - Banks, Financial Services and Insurance (BFSI)

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

Shanghai Stock Exchange Composite Index / Technical Analysis

Shanghai Stock Exchange Composite Index (SHCOMP INDEX)

<ul>
<li>We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass).</li>
<li>We will maintain our bullish intermediate-term view as long as market dynamics remain healthy and the SPX and ACWI-US are above 5700-5785 and $119-$121.</li>
<li>$125-$126 and $123-$123.50 are short-term supports to watch on ACWI-US; we will maintain our near-term bullish outlook as long as $123 support holds.</li>
</ul>


We remain near-term bullish since our 4/22/25 Compass, and our intermediate-term outlook remains bullish as well (as of our 5/14/25 Compass).
We will maintain our bullish intermediate-term view as long as market dynamics remain healthy and the SPX and ACWI-US are above 5700-5785 and $119-$121.
$125-$126 and $123-$123.50 are short-term supports to watch on ACWI-US; we will maintain our near-term bullish outlook as long as $123 support holds.


China and Japan Breaking Out -- Buy; Bullish Outlook Intact; U.S. Dollar (DXY) Remains Weak

Market & Forensics Analyst, Beat the Street

Nimish Maheshwari

Market & Forensics Analyst

Beat the Street

Beat The Street was founded by Nimish Maheshwari and Sudarshan Bhandari, both of whom are Chartered Accountants by Profession, known for their expert analysis in the fields of Business, Sectoral analysis, and Corporate governance.

With a strong social media presence of 45,000+ Subscribers across various platforms, they are considered trusted voices in the industry. Their insights and analysis have been featured in some of India’s most prominent publications, including the Economic Times, Dalal Street Investment Journal, The Morning Context, and The Ken.

Their analysis on Bankrupt & Insolvent companies has been instrumental in saving investors from significant losses. They have a keen eye for identifying red flags and has identified exclusive redflags earlier in Vedanta, Nykaa, Dhani Services, Adani and many more.

Read Business Not Stock Prices

<ul>
<li>The banking sector will likely see earnings growth bottom out in FY26, with the second half potentially performing better than the first half as deposit rate reductions eventually flow through.</li>
<li>This divergence between declining lending rates and sticky deposit costs is the core driver of NIM compression.</li>
<li>This monetary easing is expected to exert downward pressure on banks' lending yields, impacting NIMs, particularly in the first half of fiscal year 2026 (1HFY26). </li>
</ul>


The banking sector will likely see earnings growth bottom out in FY26, with the second half potentially performing better than the first half as deposit rate reductions eventually flow through.
This divergence between declining lending rates and sticky deposit costs is the core driver of NIM compression.
This monetary easing is expected to exert downward pressure on banks' lending yields, impacting NIMs, particularly in the first half of fiscal year 2026 (1HFY26). 


Impact of Rate Cut on Indian Banking Sector: NIMs & Earnings to Contract Further Amid Slowdown

<ul>
<li>Indian banks' average Net Interest Margins fell 21 basis points in FY25, projected to decline another 9 basis points in FY2026 due to RBI rate cuts and deposit competition pressures.  </li>
<li>Robust credit growth continues while deposit growth lags increasing funding costs. Nonperforming Assets for public and private banks are projected to stabilize or decline.  </li>
<li>Contracting margins squeeze core income, public banks may see profit decline FY26 despite stable asset quality aiding earnings.</li>
</ul>


Indian banks' average Net Interest Margins fell 21 basis points in FY25, projected to decline another 9 basis points in FY2026 due to RBI rate cuts and deposit competition pressures.  
Robust credit growth continues while deposit growth lags increasing funding costs. Nonperforming Assets for public and private banks are projected to stabilize or decline.  
Contracting margins squeeze core income, public banks may see profit decline FY26 despite stable asset quality aiding earnings.


Impact Of Contracting NIM On Indian Banks Earnings

Chief Executive Officer, Emmer Capital Partners Limited

Manishi Raychaudhuri

Chief Executive Officer

Emmer Capital Partners Limited

Emmer Capital Partners is an Asia Pacific focused financial advisory firm engaging in strategic financial asset allocation advice, bespoke thematic research and advising early-stage companies and connecting them to investors. Emmer Capital provides macro-economic and multi-asset investment strategy inputs to institutions, family offices, private wealth managers, private equity, and corporate boards directly and through independent research platforms. Emmer Capital also advises a wide range of startup companies on fund raising and business strategy. Emmer Capital's active engagement with the print and electronic media reaches a broad spectrum of investors across the globe.

Cross Asset Strategy

<ul>
<li>We use quantamental screens to identify overvalued stocks in Asia, with weak fundamentals – consistently low earnings growth, forecast return ratios less than cost of capital, and over-leveraged balance sheets.</li>
<li>We screen Asia-listed stocks above US$1bn market cap on declining EPS CAGR over next 2 years, less than 10% ROE, higher than 1x PEG and P/BV, more than 80% D/E.</li>
<li>We identify 30 stocks: 11 from HK/China, 9 from Japan, 4 from Taiwan, 3 from India, and one each from Korea, Malaysia and Singapore. Financials, property, industrials dominate the list.</li>
</ul>


We use quantamental screens to identify overvalued stocks in Asia, with weak fundamentals – consistently low earnings growth, forecast return ratios less than cost of capital, and over-leveraged balance sheets.
We screen Asia-listed stocks above US$1bn market cap on declining EPS CAGR over next 2 years, less than 10% ROE, higher than 1x PEG and P/BV, more than 80% D/E.
We identify 30 stocks: 11 from HK/China, 9 from Japan, 4 from Taiwan, 3 from India, and one each from Korea, Malaysia and Singapore. Financials, property, industrials dominate the list.


Asian Equities: The Overvalued, Low Growth, Over-Leveraged Stocks

India

IDFC First Bank is an Indian private sector universal bank offering a comprehensive suite of products and services across retail, MSME, rural, startups, corporate banking, cash management, credit cards, and wealth management. The bank provides savings and current accounts, fixed deposits, various loans, and investment solutions. It is headquartered in Mumbai, Maharashtra, India, and was founded in October 2015.

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IDFC First Bank (IDFCFB IN)

Q1FY26 Earnings Preview - Banks, Financial Services and Insurance (BFSI)

The systemic credit growth (as of 13th June, 2025) has derailed to <10%. This can be attributed to a meaningful slowdown in the unsecured loans...

Axis Direct

China and Japan Breaking Out -- Buy; Bullish Outlook Intact; U.S. Dollar (DXY) Remains Weak

China's Shanghai Composite and Japan's TOPIX and TOPIX Small indexes Breaking Out -- Buy; Bullish Outlook Intact on global equities $ACWI; U.S....

Vermilion Research

Impact of Rate Cut on Indian Banking Sector: NIMs & Earnings to Contract Further Amid Slowdown

Banking sector earnings growth expected to improve in FY26 as deposit rate reductions flow through, but NIM compression likely due to declining...

Nimish Maheshwari

Impact Of Contracting NIM On Indian Banks Earnings

Indian banks face declining Net Interest Margins in FY25 and FY26 due to RBI rate cuts and deposit competition, impacting profit despite stable...

Nimish Maheshwari

Asian Equities: The Overvalued, Low Growth, Over-Leveraged Stocks

Quantamental screens reveal overvalued Asian stocks with low earnings growth, low return ratios, and high leverage. 30 stocks identified across...

Manishi Raychaudhuri

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52-week Range

Market Cap (USDm)

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Q1FY26 Earnings Preview - Banks, Financial Services and Insurance (BFSI)

The systemic credit growth (as of 13th June, 2025) has derailed to <10%. This can be attributed to a meaningful slowdown in the unsecured loans...

Axis Direct

China and Japan Breaking Out -- Buy; Bullish Outlook Intact; U.S. Dollar (DXY) Remains Weak

China's Shanghai Composite and Japan's TOPIX and TOPIX Small indexes Breaking Out -- Buy; Bullish Outlook Intact on global equities $ACWI; U.S....

Vermilion Research

Impact of Rate Cut on Indian Banking Sector: NIMs & Earnings to Contract Further Amid Slowdown

​Banking sector earnings growth expected to improve in FY26 as deposit rate reductions flow through, but NIM compression likely due to declining...

Nimish Maheshwari

Impact Of Contracting NIM On Indian Banks Earnings

​Indian banks face declining Net Interest Margins in FY25 and FY26 due to RBI rate cuts and deposit competition, impacting profit despite stable...

Nimish Maheshwari

Asian Equities: The Overvalued, Low Growth, Over-Leveraged Stocks

​Quantamental screens reveal overvalued Asian stocks with low earnings growth, low return ratios, and high leverage. 30 stocks identified across...

Manishi Raychaudhuri

Banking sector earnings growth expected to improve in FY26 as deposit rate reductions flow through, but NIM compression likely due to declining...

Indian banks face declining Net Interest Margins in FY25 and FY26 due to RBI rate cuts and deposit competition, impacting profit despite stable...

Quantamental screens reveal overvalued Asian stocks with low earnings growth, low return ratios, and high leverage. 30 stocks identified across...