Published on: July 25, 2024
Banking stocks are currently in the spotlight as profit bookings have led to a decline in the Nifty Bank Index, which has corrected by 2.63% this week (up to Thursday’s closing). In the context of the Futures and Options (F&O) July series, the Nifty Bank index has fallen by 3.62%, underperforming the Nifty index, which has risen by 1.51%, driven by gains in IT, Pharma, and FMCG sectors.
One of the losers in the banking sector is Axis Bank, which saw its stock decline by over 5% due to its quarterly earnings report. This raises the question of whether investors should consider buying Axis Bank now.
We ran the Multiple Ratio Performance scanner to understand better the performance of individual Bank Nifty stocks against the Nifty Bank benchmark. This tool is designed to measure the outperformance and underperformance of various instruments relative to a chosen benchmark.
The Multiple Ratio Performance Scanner
The Multiple Ratio Performance scanner is a powerful tool that provides a relative performance chart of multiple instruments in a single frame. Here’s how to use it effectively:
1. Select the Market and Group of Stocks: Choose the market (in this case, the banking sector) and the specific group of stocks you want to analyse.
2. Choose the Period: Specify the period from which you want to view the performance data. Depending on your analysis needs, this could range from a few days to several months.
3. Select the Denominator: Choose the benchmark index or instrument against which you want to compare the performance of the selected stocks. For our analysis, the Nifty Bank index serves as the denominator.
Once these parameters are set, the chart will display the ratio performance of all selected stocks in percentage format, allowing for straightforward comparison. A rising ratio line indicates that a stock outperforms the denominator, while a falling line suggests underperformance. Each instrument is represented by a different colour on the chart, making it easy to distinguish between them.
Analysis of Banking Stocks Against the Nifty Bank Index
Using the scanner, we can observe the relative performance of individual banking stocks compared to the Nifty Bank index. This analysis helps identify which stocks outperform or underperform within the banking sector.
Outperformers: Stocks on the chart with a rising ratio line outperform the Nifty Bank index. These stocks may be showing resilience or positive momentum despite broader market corrections.
Underperformers: Stocks with a falling ratio line are underperforming relative to the Nifty Bank index. These stocks might be experiencing more significant declines or lacking positive catalysts.

Axis Bank’s significant decline following its quarterly earnings report has caught investors’ attention. The Multiple Ratio Performance scanners can provide insights into whether this decline is part of a broader underperformance trend or an isolated incident.
Investors can make more informed decisions by comparing Axis Bank’s performance ratio to the Nifty Bank index. If Axis Bank’s ratio line shows a consistent downtrend, it might indicate persistent weakness relative to its peers. Conversely, if the ratio line starts to stabilise or rise, it could signal a potential recovery or undervaluation.
The Multiple Ratio Performance scanner is an invaluable tool for investors looking to gauge the relative performance of banking stocks against the Nifty Bank index. By analysing ratio performance charts, investors can identify outperforming and underperforming stocks, helping them make better-informed investment decisions. With Axis Bank currently under scrutiny, this tool can provide the necessary insights to determine whether it presents a buying opportunity or if caution is warranted.