Indian financial sectors project growth for Q2FY27

India’s financial services sector is projected to see growth in the second quarter of FY27. According to a report by JM Financial, the banking sector is expected to report healthy profit after tax (PAT) growth. This is supported by an acceleration in loan growth to 19.1 per cent and deposit growth to 15.8 per cent year-on-year. While system liquidity remains comfortable, the report warns that elevated credit-deposit ratios could lead to persistent funding pressures as inflows from Foreign Currency Non-Resident (Bank) deposits begin to moderate.

In the insurance sector, Kotak Institutional Equities projects that Indian life insurers will see a 10-20 per cent year-on-year growth in the value of new business (VNB) during Q2FY27. Private insurers are expected to see steady underwriting performance, particularly in protection plans. The state-owned Life Insurance Corporation of India (LIC) is projected to outpace private peers in terms of profitability. Analysts suggest that market discussions may focus more on proposed regulatory distribution norms and guidelines rather than purely on quarterly financial results.