Stocks to buy today: Market experts believe that Yes Bank share price can go up to ₹60 per share in the next four to five years
Stocks to buy: After the Bank Nifty index rallied over 21 per cent in 2022, retail investors are in a quandary whether the rally in banking stocks will continue or it is time to book profits and look at other themes for the next year. However, if we go by the views of market experts, the rally in mid-sized PSU bank stocks and tech-enabled lenders in the private sector may continue in 2023 as well. He added that due to the Indian government's initiative to tackle bad loans, banks are expected to deliver strong quarterly numbers in the medium to long term and PSU banks are expected to match private banks in the banking business.
Stock market experts further said that the easing dollar index has made overseas borrowings costlier for large corporates and hence such corporates are coming back to the Indian banking system for credit lines. This is also helping PSU banking stocks in the medium to long term. However, in the private sector, banks that have focused on tech-enabled lending are going to score over their peers and banks such as Axis Bank, ICICI Bank, HDFC Bank and IDFC First Bank are among the first to offer such services in India. The emerging business model is expected to benefit. For retail investors who want to tap the opportunities available in the banking sector but have limited funds to invest, experts recommend buying mid-sized PSU and private bank stocks. He said that shares of Yes Bank, PNB, IDFC First Bank, Bank of Baroda etc. have to be bought.
IDFC
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83.20-0.90 (-1.07%)
Updated - 06 January 2023
84.25
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82.15
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2,59,034.00
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Favoring the banking theme for the medium to long term, Sandeep Pandey, business partner, MK Global Financial Services, said, "The idea of the finance ministry to handle bad loans through ARCs is going to have a big impact on the Indian banking system. Now, The system is providing opportunities to lenders who are under stress of bad loans. Now, bad loans will not compel any bank to continue provisioning for a long time and remain under NPA stress."
The former vice-chairman of HDFC Bank Ltd said the bad loan initiative by the central government has left state-owned banks ill-equipped to match up with private players. Hence, the market is positive on PSU banks as they are available at a higher discount than their peers in the private sector.
yes bank
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21.10-0.35 (-1.63%)
Updated - 06 Jan 2023
21.70
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20.95
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On why bank stocks will continue to rally, Chandan Taparia, Derivatives & Technical Analyst, Motilal Oswal said, "In view of the rise in US dollar, large corporates had gone overseas for credit lines, but after the easing in US dollar, These are big corporates. It is expected that there will be a comeback in the Indian banking system. This is going to impact the margins of Indian banks positively. Also, the high interest rate regime is working in favor of Indian banks. Hence, medium Banks' profitability and margins are expected to improve for the period. Long term and hence should continue investing in banking stocks as the bank theme is going to work for the medium to long term."
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Motilal Oswal expert further said that tech-enabled private lenders are going to benefit more than their peers and hence Axis Bank, ICICI Bank, HDFC Bank and IDFC First Bank stocks are expected to remain in focus.
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