Quote on the Outlook for PSU Banks from Ajit Kabi, LKP Securities
Below the Quote on the outlook for PSU Banks from Ajit Kabi, Banking Analyst at LKP Securities
Public banks have performed well post COVID. The asset quality cycle tailwind has resulted in improvement in NPA ratios. The corporate credit woes are behind us. Therefore we expect the credit cost normalisation in the coming period. As per as growth is concerned, the PSU Banks are likely to report strong growth factoring capex improvement. The large PSU Banks like SBIN and BOB are also growing rapidly on the consumer credit front. Hence we expect further room for re-rating. Nevertheless, The ECL provision will be keenly watched. We prefer large PSU Banks; SBIN, BOB and PNB (considering the valuations).
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