In normal times, past performance gives an indication of what to expect in the future. This time, however, the covid-19 outbreak has made the past irrelevant and, hence, investors of Indian banks are likely to look through the fourth quarter (Q4) results.
Since the lockdown to contain the covid-19 spread came into effect in the final week of March, the quarter is unlikely to show the full impact.
Nevertheless, Indian banks are expected to report a drop in net profit for Q4, as loan growth was subdued and corporate insolvency resolutions slow. Click here to enlarge graphic Emkay Global Financial Services Ltd analysts estimate a 7% drop in net profit of private sector banks on an aggregate basis.