The downgrade of IndusInd Bank was based on high valuations and a view that the near-term margin pressure have not been discounted enough. The rating cut on SBI was based on expectations that the near-term NPL pressure for the lender is likely to stay intense and that the recent growth could aggravate margin pressures. Recently, a compilation of bank valuations in terms of price-to-book value showed that both Kotak and IndusInd stocks traded close to their five-year average valuations even as rest of the banks, including HDFC Bank and ICICI Bank and SBI stood at 10% to 60% discount to their mean valuations.