Markets have slumped further with the BSE Sensex now plunging more than 1,600 points in afternoon trade on Jan 17. 

Sensex is down 2.2% or 1,611 points at 71,516 points.

Private sector banks, metals are leading the market fall which is awash in a sea of red. Private sector bank stocks are the biggest losers as the Sensex plunged 1,300 points.

Index heavyweight, HDFC Bank is down more than 8%, Kotak Mahindra is down more than 3%, Axis Bank is down 3%, ICICI Bank is down 2%.

Tata Steel is down more than 3% while JSW Steel is down more than 2%.

Elara Securities said in a report that HDFC Bank’s Q3 PAT of Rs 163.7bn was broadly in line with our estimates following higher other income (stake sale in Bandhan Bank) and lower tax, even as core profitability fell short of expectations.

The key highlight was higher-than-expected strain on NIM (even on trimmed expectations), given higher funding cost pressures. 

Given the regulator’s focus on CD ratio and HDFCB already at 110%, with LCR of 110%, the bank has much to balance (growth versus NIM conundrum).

While one may argue on the bottom of earnings, we believe recovery may take longer and the stock may see time correction till investors find merit in execution, the report said.

(Source: IANS)

-Edited for style

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