The rally in banking shares is likely to get selective hereon, and large banks will fare better, said Abhishek Murarka, VP of IIFL Institutional Equities.
“There was an initial catch up phase and the sector was underperforming for a while and we had a period where there was a positive news flow and that helped the catch up, but after the first leg it will be quite selective and our view is that large banks including SBI and of course ICICI Bank, HDFC Bank, Axis Bank – all the large banks are going to be disproportionate beneficiaries of the catchup,” Murarka said in an interview to CNBC-TV18.
In the midcap space, Murarka likes RBL and Cholamandalam Finance. “We like RBL Bank, valuations are attractive and the business is mending. We also like Cholamandalam, although it has become expensive, but on dips or on corrections we see a lot of upside fundamentally and structurally,” he said.
According to him, Bajaj Finance is expensive at 7 times price to book value.
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