# Bandhan Bank Shares Fall 10 Percent as Cut to Profitability Guidance Overshadows Profit Jump

The Indian lender's lowered return outlook drove a downgrade even as first-quarter net profit rose 35 percent, while Bajaj Auto gained on strong results.

- Published: 2026-07-22T05:31:48.407Z
- Canonical: https://polylog.news/2026-07-22/bandhan-bank-shares-fall-10-percent-as-cut-to-profitability
- Publisher: Polylog (Global desk)
- Section: markets
- Sources: [Economic Times](https://m.economictimes.com/markets/stocks/news/bandhan-bank-shares-crash-10-after-q1-results-lender-cuts-roa-guidance-should-you-buy-sell-or-hold/articleshow/132550886.cms), [Economic Times](https://m.economictimes.com/markets/stocks/news/bajaj-auto-shares-rise-over-2-after-q1-should-you-buy-sell-or-hold-the-stock/articleshow/132550838.cms), [Economic Times](https://m.economictimes.com/markets/stocks/news/sbi-funds-shares-fall-3-but-brokerages-scream-buy-with-target-price-up-to-rs-750/articleshow/132551208.cms)

Shares of Bandhan Bank fell about 10 percent on Wednesday after the Indian lender cut its return-on-assets guidance, a signal that outweighed a 35 percent year-on-year rise in first-quarter net profit, the Economic Times [reported](https://m.economictimes.com/markets/stocks/news/bandhan-bank-shares-crash-10-after-q1-results-lender-cuts-roa-guidance-should-you-buy-sell-or-hold/articleshow/132550886.cms). The brokerage Motilal Oswal downgraded the stock to neutral, citing pressure on margins and lowering its earnings estimates for the next two years.

The results contrasted with a stronger picture elsewhere in Indian corporate earnings. Bajaj Auto rose more than 2 percent after reporting a 46 percent jump in quarterly net profit to 3,226 crore rupees on a 65 percent rise in revenue, the Economic Times [reported](https://m.economictimes.com/markets/stocks/news/bajaj-auto-shares-rise-over-2-after-q1-should-you-buy-sell-or-hold-the-stock/articleshow/132550838.cms), prompting Motilal Oswal to upgrade the stock to buy.

Even where prices fell, brokerages stayed positive. Shares of SBI Funds Management slipped 3 percent after their market debut, yet analysts at Emkay and Equirus [maintained buy ratings](https://m.economictimes.com/markets/stocks/news/sbi-funds-shares-fall-3-but-brokerages-scream-buy-with-target-price-up-to-rs-750/articleshow/132551208.cms), citing the parent bank's distribution reach and long-term growth prospects.

The divergence within a single day's earnings shows an Indian market that distinguishes companies by their fundamentals rather than moving in one direction. Domestic demand and financial-sector earnings continue to support sentiment, letting investors penalize a weaker margin outlook at one lender while rewarding strength at a manufacturer.

## What this means

The market's sharp reaction to Bandhan's guidance cut, despite higher profit, shows Indian investors focused on future profitability rather than reported earnings, which exposes lenders with margin pressure to steep repricing. The broader pattern of strong consumer and manufacturing results reinforces the domestic-demand story that has drawn investment seeking growth insulated from global oil and rate shocks.

## What to watch

- Guidance from other Indian private banks reporting this quarter, since a pattern of margin compression would weigh on the financial sector that supports the market.
- Foreign portfolio flows into Indian equities, which would show whether the domestic-demand story continues to attract capital seeking insulation from global stress.