The new private sector banks such as Kotak Mahindra Bank and Yes Bank will focus on rural India and emerging sector banks to stay profitable while the larger banks like ICICI Bank and HDFC Bank will grow both their corporate and retail book, concentrating on working capital loans on the corporate side and home and car loan on the retail side.

Axis Bank, which grew on the back of infrastructure lending, will now gradually bring down its telecom exposure, while infrastructure segments like power generation and engineering would continue to be focus areas.

Kotak Mahindra, which has a total loan book of Rs 35,000 crore, says that the assets of ‘Bharat’ (rural India) are what is attracting the bank right now. On the liability side, urban India is where more of the money is. And in rural India or semi-urban India, where there is large requirement of money.

Jaimin Bhatt, CFO, Kotak Mahindra Bank, says, “We expect one third of our growth to come from rural and semi-urban India. Growth for the bank will be equally spread between urban, rural and semi-urban. On the wholesale banking side, at this point of time, we are focused on making sure that we do not have disproportionate concentration to any sector or industry and we have tried to be a little more conservative on sectors like telecom, or airlines, or any other major infrastructure that turns revenues and to be a little more cautious and historically we do not have a concentrated exposure.”

Yes Bank, another new age private sector with a total loan book of Rs 33,000 crore, has a well diversified portfolio with the bank focusing on knowledge banking sectors with infrastructure, food and IT business, engineering, life sciences contributing to maximum revenues.

A senior Yes bank official said, “Certainly, there is moderation in growth. And there is more risk in the economy right now which is reflected in the fact that we have in the June quarter tried to consolidate, tried to take away some bulky, low priced, less attractive loans to make sure that margins are maintained. And at the same time, we will also try to derisk without compromising on the profitability.”

The bank plans to be cautious on auto, textiles, telecom and micro finance segments.

Third largest private sector bank Axis Bank which had a loan book size of Rs 1,31,900 crore expects growth in corporate banking is likely to come from working capital and planned investments for outstanding trends in the infrastructure space.

While telecom has moved out of the bank’s top ten segments to which it lends, concentrating on repayments on loans extended to 3G companies, which at the peak was about Rs 600,000 crore both funded and non-funded. The top five segments that continue to get the bank’s focus are financial companies and sub-structure of construction, power generation, metals and engineering according to the analyst presentation that the bank undertook after the first quarter results.

ICICI Bank with a total advances of Rs 2,21,000 trillion has four to seven per cent of its total exposure to power and real estate. But it will now be more broad-based with relative caution to telecom, textiles and jewellery and the airline sector.