Citi Predicts Modest Q3 Profit Growth for Indian Banks; Bank Nifty Levels to Watch

• Citi expects Indian banks to report modest Q3 profit growth: 5% YoY net interest income and 4% increase in profit after tax.
• Credit growth is likely to slow to 3-5% sequentially, with divergent trends in net interest margins (NIMs) across banks.
• NIMs expected to expand for AU Small Finance Bank, HDFC Bank, Kotak Mahindra Bank, RBL Bank, SBM Bank; flat for ICICI Bank, IDFC First Bank; dip for Axis Bank, Yes Bank.
• Citi placed HDFC Bank and Kotak Mahindra Bank on a 90-day positive catalyst watch, while downgrading Federal Bank to "neutral".
• Bank Nifty shows consolidation; key levels for traders are 59,306 (trend-deciding), 58,700 (support), and 59,800 (breakout for upward move).

Why It Matters: Indian banks anticipate modest Q3 profit growth amid slowing credit and mixed NIM trends; Bank Nifty consolidates.