Santanu Chakrabarti, head-BFSI research and senior vice president of Edelweiss Financial Services said that he expects to still see some growth from banks in Q4.
Speaking to CNBC-TV18, Chakrabarti said, “As far as earnings are concerned, we are still going to see growth. Any uncertainty related to the second phase of COVID infection offers a lot less protection in the midcap banks than it does for larger banks.”
“Therefore, the only midcap idea that we have been pushing is AU Small Finance Bank which has done well for us, but other than that our preferences are to stick with HDFC Bank, ICICI Bank, Axis Bank, and State Bank of India (SBI),” he said.
Talking about NBFCs, Chakrabarti said, “We like Shriram twins (Shriram Transport Finance Corporation and Shriram City Union Finance), LIC Housing Finance. We also like HDFC Ltd, although the return expectation is lower than the other names but given the quality it still makes sense.”
Also, watch the accompanying video of CNBC-TV18’s Abhishek Kothari to get a handle on the Q4 expectations from the banking sector in earnings special - Quarter Se Quarter Tak (QSQT).