PSBs' growth output superseded Private Lending firms

Out of 20, 15 largest banks in India witnessed gains in market capitalisation, where 13 of them posted double-digit increases.

PSBs' growth output superseded Private Lending firms

New Delhi: State-owned banks have surpassed their private-sector peers, posting the highest gains in their market capitalization in Q4 FY24, while improving on their financial structure.

The government’s focus on long-term projects has played a crucial role in benefiting state-owned lenders, S&P Market Intelligence said in a note.

Out of 20, 15 largest banks in India witnessed gains in market capitalisation, where 13 of them posted double-digit increases. The market capitalisation of all PSU banks, on the list of the country’s 20 largest banks, improved from the previous quarter.

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The most outstanding performance was led by Indian Overseas Bank among the country’s 20 largest banks, logging a 38.5 per cent sequential increase in market capitalisation to ?1.13-lakh crore as of March 2024.

 Punjab & Sind Bank and Bank of Maharashtra ranked second and third, with gains of 38.4 per cent and 38.1 per cent, respectively. 

Meanwhile, only ICICI Bank and Yes Bank saw an improvement among private banks, posting single-digit growth in market capitalization. Some other banks that witnessed a decline in their market capitalization were private sector banks — HDFC Bank, Kotak Mahindra Bank, Axis Bank, IndusInd Bank and IDFC First Bank.

Several investing options of Indian banks, especially PSU banks, have notably strengthened in recent years due to robust credit growth in a fast-growing economy. 

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The private bank index is considered to be affected by HDFC Bank, which comprises about 26 per cent of the index. 

Market capitalization of HDFC Bank declined 15.2 per cent in the quarter to nearly Rs 11-lakh crore. Yet HDFC Bank retained its position as the top bank. ICICI Bank and State Bank of India, too, held their second and third ranks, respectively.

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