Tuesday, 18 November 2008

Invest in SBI, PNB: Bharatan

Sheshadri Bharatan of Dawnay Day AV Financial Services is of the view that one can invest in Punjab National Bank, State Bank of India, HDFC Bank, Axis Bank from one year time frame.

Bharatan told CNBC-TV18, "Today there was some reports that ICICI Bank might cut on their credit growth from 30% to 15%, so most of the banks might cut down their credit growth and that is one factor, which might affect the banking stock. Second is delinquencies, there are talks that the credit that has been given in the past also might see some kind of delinquencies be it personal loans, home loans etc. So I think there is a case of these stocks coming under selling pressure. Also yesterday expectations of rate cuts, which has not happened so these stocks went under hammer."

He further added, "If you look at a longer-term view banks, which have very higher Current Account and Saving Account (CASA) deposit like Punjab National Bank, State Bank of India, HDFC Bank, Axis Bank are banks that one can look for to invest for at least a years time. Because as and when the market turns around, the Indian economic growth story will continue, Gross Domestic Product (GDP) will grow above 7%, next year we might grow above 8%. So the first sector, which will benefit out of growth in economy would be banking sector. So anybody who is betting on India story has to participate in banking sector. At this point of time we are witnessing broad selling across the markets, as and when market shows some kind of stability, I would not say recovery we might see investors coming back into the banking sector again."

Source: Moneycontrol

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DISCLAIMER: The author is not a registered stockbroker nor a registered advisor and does not give investment advice. His comments are an expression of opinion only and should not be construed in any manner whatsoever as recommendations to buy or sell a stock, option, future, bond, commodity, index or any other financial instrument at any time. While he believes his statements to be true, they always depend on the reliability of his own credible sources. The author recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction, before making any investment decisions, and that you confirm the facts on your own before making important investment commitments.