India's largest private sector lender ICICI Bank's market capitalization plunged 23% to Rs 96,165 crore since the beginning of the second quarter (July- September). This was the highest erosion among top six banks in nearly last two months.
Meanwhile, India's largest bank state-owned State Bank of India's market cap fell by 17% to Rs 1,24,801 crore during the same period. This is 6% less than that of its private sector peer ICICI Bank market cap loss.
The second largest PSU lender Punjab National Bank’s market cap dropped around 11% to Rs 30,407 crore. The fall is marginally (around 1%) higher than its private sector peer HDFC Bank, which fell by 10% to Rs 1,03,894 crore.
Axis Bank, the third largest private sector lender, sank 21% to Rs 42,113 crore. This was higher in comparison to the third largest PSU lender, Bank of Baroda’s market cap that slipped 18% to Rs 28,130 crore.
Analysts tracking the sector believe FIIs are bullish on private sector banks. That is why they are overweight on private bank shares. However, the erosion is not related to any fundamental change. It is more due to the prevailing negative sentiment on global economic turmoil.