BackBanking stocks give a thumbs up to RBI policy
Stock market today: RBI's decision to keep CRR unchanged and hike repo rate has gone down well among the banking stock enthusiasts, believe stock market experts
PremiumStock market today: Banking stocks have responded positively after the 50 bps repo rate hike announced in today's RBI policy. Banking major SBI share price is up over 2 per cent, after trading red in early morning deals HDFC Bank share price is up near 1 per cent, Bank of Baroda is near 2.70 per cent higher from its Tuesday close on NSE while Kotak Mahindra Bank, Federal Bank, ICICI Bank and IndusInd Bank are also trading in positive zone.
According to stock market experts, RBI's decision to keep CRR unchanged and hike repo rate has gone down well among the banking stock enthusiasts. They said that it is heartening to see that RBI MPC has not left growth factors completely out of consideration and if inflation cools, growth may again take precedence, a situation that will benefit banking sector through hike in demand for credit line.
Speaking on the reasons for rise in banking stocks post-RBI policy announcements, Ravi Singhal, Vice Chairman at GCL Securities said, "In today's RBI policy announcement, the central bank of India has raised repo rate by 50 bps but it has kept CRR unchanged that is expected to boost banking business. This scenario will enable Indian banks to have more money for lending and more income through hike in interest rate."
Echoing with Ravi Singhal of GCL Securities, Raghvendra Nath, Managing Director at Ladderup Wealth Management Private Limited said, "CRR was expected to be raised, but it seems RBI has decided to maintain the liquidity with banks for now."
Expecting sharp upside in Nifty Bank index, Sumeet Bagadia, Executive Director at Choice Broking said, “Nifty Bank index is currently trading in 34,700 to 35,500 range. On breakage of the upper hurdle, which is quite possible after the RBI's decision to keep CRR unchanged, there can be 1,000 points more upside in the Nifty Bank index."
On banking stocks that one can add in one's portfolio after the RBI policy announcement, Ravi Singhal of GCL Securities said, "SBI, ICICI Bank, Axis Bank and HDFC Bank shares may give sharp upside move after the RBI policy announcement. So, those who are looking to add some banking stocks in their portfolio, they can look at SBI as their top priority followed by ICICI Bank, Axis Bank and HDFC Bank shares respectively." He said that these banks are better placed to get advantage of RBI's decision to keep CRR unchanged.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
