On Thursday, the share prices of HDFC Bank and ICICI Bank soared to unprecedented heights, creating a buzz in the stock market as investors eagerly awaited the upcoming Q4 results. The impressive rally in banking stocks has propelled the Nifty Bank index to closely approach its 52-week peak, showcasing its resilience against the benchmark Nifty 50. Both HDFC Bank and ICICI Bank emerged as standout performers, capturing the attention of market watchers ahead of their financial announcements this weekend.

Record-Breaking Gains for HDFC Bank and ICICI Bank

HDFC Bank shares witnessed a notable uptick of over 1%, reaching a historic high, while ICICI Bank shares surged by more than 2%, achieving a lifetime peak. Specifically, HDFC Bank’s stock climbed to ₹1919.35 on the BSE, reflecting a gain of 2.02%. Meanwhile, ICICI Bank’s shares hit ₹1408.60, marking a remarkable rally of 3.82%. It’s important to note that these record prices have been adjusted for previous stock splits, mergers, and bonus issues.

• HDFC Bank: Closed at ₹1919.35, up 2.02%
• ICICI Bank: Closed at ₹1408.60, up 3.82%

Anticipation for Q4 Financial Results

As the leading private banks in India, both HDFC Bank and ICICI Bank are set to release their Q4 results for FY25 on April 19. With a stock market holiday scheduled for April 18, investors have only today to make any buy or sell decisions regarding these popular banking stocks.

Insights on HDFC Bank’s Q4 Performance

HDFC Bank, recognized as the largest private sector lender in India, is projected to show modest growth in both net profit and net interest income (NII), although margins are expected to face some pressure. According to estimates from Motilal Oswal Financial Services (MOFSL), the bank’s net profit is anticipated to rise by 3.2% year-on-year (YoY), with NII growth estimated at 5.5% YoY.

• Projected Deposit Growth: 14.6%
• Expected Loan Growth: 3.8%

MOFSL believes that HDFC Bank is focusing on operational efficiency to maintain stable cost ratios while continuing to invest in growth. They project a decline in both the cost-to-income and cost-to-asset ratios to around 40% and 1.7% by FY27, positioning the bank for consistent growth.

ICICI Bank’s Promising Q4 Outlook

ICICI Bank is expected to demonstrate a robust performance in Q4 FY25, buoyed by solid business growth and an uptick in asset quality. Analysts forecast a 12.3% YoY increase in net profit and a 9.2% YoY growth in NII.

• Targeted Return on Assets (RoA): 2.2%
• Targeted Return on Equity (RoE): 17%

According to MOFSL, ICICI Bank is well-positioned for strong performance, targeting impressive returns and trading at 2.2x FY26E ABV. Both banks are favored picks in the banking sector, with MOFSL giving a ‘Buy’ rating for each, projecting price targets of ₹2,100 for HDFC Bank and ₹1,600 for ICICI Bank.

Technical Analysis Insights

Anshul Jain, Head of Research at Lakshmishree Investment, suggests that ICICI Bank is currently more attractive in terms of risk-reward dynamics. Jain notes that ICICI Bank stock has recently broken out of a 140-day Volatility Contraction Pattern (VCP) at ₹1,362. He anticipates a potential upward movement towards ₹1,500 shortly. On the other hand, HDFC Bank, while at its all-time high, may see some profit-taking.

• HDFC Bank Closing Price: ₹1906.55, up 1.53%
• ICICI Bank Closing Price: ₹1406.65, up 3.68%

As both banks prepare to unveil their quarterly results, market participants are keen to see how these financial giants will continue to navigate the evolving banking landscape.