BofA Merrill turns positive on Indian state-owned banks
Reuters Market Eye - Bank of America Merrill Lynch upgraded State Bank of India, Bank of Baroda (BOB.NS), and Oriental Bank of Commerce Ltd (ORBC.NS) to 'buy'.
The investment bank says upgrades come on the back of a steepening bond yield curve in the anticipation of RBI rate cuts, stronger-than-expected loan recoveries, and reduced quality pressures.
BofA Merrill also upgrades its price objectives for private banks, retaining ICICI Bank Ltd (ICBK.NS) as its top pick, and HDFC Bank Ltd (HDBK.NS) and Axis Bank Ltd (AXBK.NS) as its "preferred" names. All three banks have 'buy' ratings.
"Private banks will likely continue to deliver structurally superior earnings and RoEs, especially over the medium term," BofA Merrill says in a note dated Tuesday.
- Tweet this
- Share this
- Digg this
Trending On Reuters
India can increase public investment to drive growth without borrowing more, a key government report said on Friday, in an indication that Finance Minister Arun Jaitley will stick to debt targets in his maiden full-year budget on Saturday. Full Article