With banks leading the way on Dalal Street, state-owned PSU lender (SBI) has seen the highest number of target price updates in recent times.
Of the 38 analysts covering SBI, which reported the highest quarterly profit (PAT) of Rs 13,264.62 crore in Q2, at least 10 of them have updated their target prices in the last month, shows Trendlyne’s data. . Average targets show a potential upside of 14%.
SBI is also a consensus buy on Dalal Street with no sell reviews, only 2 offers and 36 buy reviews.
, another consensus pick with 26 buy calls, earned an 8 price target upgrade amid optimism about 5G and rising tariffs in a congested telecom market. The stock is up 21% year-to-date (YTD).
Despite receiving 8 upgrades, shares of pharmaceutical major Lupine are still down 20% this year. Similarly, despite 6 updates, shares are down 14% YTD.
List of latest updates include , , , , M&M and Cipla.
What should investors do?
Both domestic and foreign institutional investors (FIIs) have been bullish on banks. Against a 7% gain for the Nifty in 2022, the banking index has risen 21% over the period.
“We maintain the investment thesis that we are still at the beginning of the current credit cycle and the prospect of a sharp deterioration in asset quality is unlikely. We believe that tier-2 banks such as public sector and regional banks are better than first-tier banks, Kotak Institutional Equities said.
Kotak prefers PSU banks while buying ratings on SBI, , , Axis Bank, DCB Bank, and , global brokerage BofA Securities.
“We see BOB continuing to lead the PSB turnaround story beyond SBI on a diversified/safer book and a more advanced digital strategy. We still remain positive on SBI (Neutral) but see narrow scope for positive surprises,” said BofA analyst Anand Swaminathan.
After the September quarter earnings, Ambit Capital IOCL, Trent, Zomato, and while BPCL, , HPCL, Voltas and .
(Disclaimer: The suggestions, recommendations, views and opinions are the experts’ own. They do not represent the views of The Economic Times.)