Seen as a recovery quarter after losses in the derivatives segment in the previous quarter, the Street will be focusing on asset quality trends, credit costs, and commentary on deposit mobilisation and succession planning post the Q4 shock.
1. PAT
Net profit is projected to fall 65% to 91% YoY, reflecting the aftermath of the Q4 loss and continued provisioning burden.
The lender had reported a consolidated net loss of Rs 2,329 crore in its Q4FY25.
- Emkay: Rs 194 crore, down 91% YoY)
- Nomura: Rs 350 crore, down 85% YoY
- Nuvama: Rs 740 crore, down 65% YoY
- Kotak Equities: Rs 534 crore, down 75% YoY
2. NII / NIM:
Net interest income (NII) is estimated to decline 22–25% YoY, but NIMs may rebound QoQ after Q4’s derivative loss impact.
- Emkay: 4,080 crore, down 24.6% YoY and down 33.8% QoQ | NIM: 3.1%, down 118 bps YoY and up 82 bps QoQ
- Nomura: Rs 4,150, down 23% YoY and up 36% QoQ | NIM: 3.2%, down 103 bps YoY and up 97 bps QoQ
- Nuvama: Rs 4,200 crore, down 22% YoY and down 38% QoQ | NIM: 3.40% down 85 bps YoY and up 115 bps QoQ
- Kotak: Rs 4,227 crore, down 22% YoY and up 39% QoQ | NIM: 3.1, down 106 bps YoY and 87 bps QoQ
3. Pre-Provision Operating Profit (PPoP):
Operating profitability is expected to be weak, reflecting muted core income and cost pressures.
- Nomura: Rs 2,260 crore, down 23% YoY and 561% QoQ
- Nuvama: Rs 2,480 crore, down 36.8% YoY and down 625% QoQ
- Kotak: Rs 2,394 crore down 39% YoY
4. Loans & deposits:
Nomura expects a 4% YoY and 3% QoQ decline in Q1 loans while pegging a flat YoY growth in deposits at Rs 3,97,200 crore. It may fall 3% QoQ.
Meanwhile, Nuvama sees loans at Rs 3,34,500 crore, down 3.9% YoY and down 3.1% QoQ. As for the deposits, a 0.3% YoY and 3.3% QoQ decline to Rs 3,97,200 crore is expected.
Kotak expects deposit growth at 1% YoY, better than feared, given recent concerns.
5. Provisions & Credit Cost:
Provisioning is expected to remain elevated due to MFI stress.
- Nomura: Provisions Rs 1,790 crore, up 71% YoY and 29% QoQ
- Kotak: Expects slippages of ~₹1,700 crore (≈2%) from MFI
- Emkay / Nuvama: Also see high stress-related provisioning, albeit moderating QoQ
6. Credit cost
Nomura expects credit cost to rise by 81 bps YoY to 2.1% while declining 83 bps QoQ.
7. Key monitorables
Brokerages see asset quality trends in the MFI portfolio as a key monitorable. Investors should also watch out for deposit mobilization, marginal cost of funds, and governance situation.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
