See FY16 earnings growth at 7%; like Bank Nifty: Edelweiss

Edelweiss Securities is overweight on Bank Nifty because of three major decisions; RBI's 5:25 scheme, Rs 70,000 crore of equity to be pumped in public sector unit (PSU) banks and induction of foreign MDs and CEOs, which would professionalise the system and improve the credit base.Speaking to CNBC-TV18, Nischal Maheshwari of Edelweiss Securities likes State Bank of India (SBI) and Bank of Baroda (BoB), Indusind Bank and Yes Bank.With margins coming in line with expectations, Maheshwari expects 6-7 percent Sensex earnings growth for FY16.Recommending a buy on L&T, he says though domestic is a challenge for the company, with an all time high orderbook, the stock will do well. Meanwhile, he is also positive on Hero Motocorp because of its positive earnings.Bullish on IT, he recommends buying Infosys, Tech Mahindra, and HCL Tech (in the order).However, Siddarth Bhamre of Angel Broking recommends a buy on SBI because he believes the entire bounce back in SBI is because of short covering.“The delivery based volumes are high because there were people who were stuck in these stocks five – ten percent lower from current levels and they are selling because their cost have come,” he says adding “unlike ICICI Bank where you had seen on the result day there was addition of open interest which is an indication that some people have gone long also.” About the Nifty, he is not optimistic even if there is a rate cut, he says, adding, “If you look at historical data of a rate cut or any change in interest rates, the sensitivity of market towards the change in rate is generally when the trend in interest rate is reversing and not within the trend.”