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Outstanding Credit Cards grew 8% YoY; spends decline 4% YoY

ICICIBC and SBICARD comprise ~63% of incremental market share in 11MFY21

* The Banking system reported net additions of 549k new Credit Cards in Feb’21 (a 47% YoY decline) v/s 701k new additions in Jan’21. This has taken the total Credit Card base to ~61.6m (7.9% YoY growth) v/s a growth of 8.9% YoY in Jan’21.

* During Feb’21, ICICIBC, SBICARD, and AXSB were the largest Credit Card acquirers, with an incremental market share of 36.1%, 18.1%, and 18%, respectively. In 11MFY21, ICICBC gained the highest incremental market share of ~32.4%, followed by SBICARD at 30.6%.

* Credit Card spends declined 4% YoY to INR604b in Feb’21. In 11MFY21, total spends declined 18.4% YoY to INR5.6t. Among large players, ICICIBC reported a 10% YoY growth in monthly card spends, while HDFCB and SBICARD reported a marginal decline.

* SBICARD and ICICIBC continued their strong performance, resulting in an 80-110bp increase in market share in outstanding cards to 19%/16.8% in Feb’21 from 18.3%/15.8% in FY20. RBK and IIB have largely maintained their market share, while other major players (HDFCB, AXSB, CITI, KMB, AMEX, and SCB) have lost market share.

* While the surge in COVID-19 cases and ensuing lockdown in various states could slow down the recovery momentum, SBICARD would continue to gain market share, led by its diverse acquisition channels. We maintain a Buy on SBICARD with a TP of INR1,200 per share.

Outstanding Credit Cards grew 8% YoY; ICICIBC and SBICARD are key gainers

Total number of outstanding Credit Cards for the system grew 7.9% YoY in Feb’21 (v/s 8.9% YoY in Jan’21) to ~61.6m. Among the major players, ICICIBC reported strong (15.7% YoY) growth, followed by IIB (13.1%) and SBICARD (12.3%). RBK too reported a healthy (10.4% YoY) growth in its outstanding card base. Foreign players like CITI/AMEX saw a decline of 5%/8%. SBICARD/ICICIBC continued their strong performance, resulting in an 80-110bp increase in their market share to 19%/16.8% in Feb’21 from 18.3%/15.8% in FY20, while HDFCB continues to be the largest player with a market share of 24.7% (-46bp in 11MFY21).

549k cards added in Feb’21, ICICIBC and SBICARD account for ~54% share

In Feb’21, ~549k cards were added to the system, of which ~198k was added by ICICIBC (36% market share), while SBICARD and AXSB added 99-100k, with an incremental market share of ~18% each. RBK added ~41k cards, with an incremental market share of 7.5%. On the hand, HDFCB lost ~57k cards, while IIB lost ~33k cards. In 11MFY21, ICICBC gained the highest (~32.4%) incremental market share, followed by SBICARD at 30.6%. HDFCB’s incremental (~18%) market share was affected by a decline in its card base over the past three months. IDFCFB, which recently launched its Credit Cards business, has also gained an incremental market share of ~11% in Feb’21.

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