Best Banking Stocks to Buy now in India 2023

Best Banking Shares to Invest: The performance of the banking sector has been strong in the June quarter earnings season. At the same time, the banking index has performed better than others in the recent past. Good momentum is being seen in bank stocks. Brokerage house ICICI Securities has expressed confidence in this sector. The brokerage says that credit demand from the retail and MSME sectors is strong, while credit costs have come down. Net interest income has increased due to improvement in the asset quality of banks. This sector will get maximum benefit from further economic recovery.

Strong and regular credit demand

According to brokerage house ICICI Securities, strong and regular credit demand is being seen from the retail and SME segments. On an average, there has been little concern about the asset quality of banks. Due to this, the banking sector has performed stronger than other sectors in the recent past. Earnings of banks have also been better in the June quarterThere has been a steady improvement in income. Credit growth sustained, asset quality improving. Although the overall operating profit has been impacted due to rising treasury yields, the bottom line has been boosted due to low provisioning. The sector is also getting the benefit of the rate hike.

Growth in NII as well

Talking about the June quarter, loan growth has been 15.4 percent on an annual basis and 2.2 percent on a quarterly basis. Due to the strong demand in the retail and MSME sector, it has become a total of 114.9 lakh crores. Due to this, growth is also being seen in the NII of the banks. NII grew by 13.5 percent on an annual basis and 2.5 percent on a quarterly basis. Credit costs (provisions) declined for the June quarter due to better asset quality and lower slippagesIn the June quarter, overall net profit has grown by 32.4 percent on an annuals basis and 10 percent on a quarterly basis. The brokerage believes that the banking sector will get the maximum benefit of the economic recovery and the momentum that has been created in it is going to continue even further.

Best stock for investment

SBI

Current Price: Rs 558

Target Price: Rs 650

Return: 16%

Axis Bank

Current Price: Rs 806

Target Price: Rs 970

Return: 20%

City Union Bank

Current Price: Rs 183

Target Price: Rs 215