Sandeep Bhatia of Kotak Institutional Equities said he would not expect more than 10 percent up tick in private banks stocks from current levels. He is cautious on the sector.
Sandeep Bhatia of Kotak Institutional Equities said he would not expect more than 10 percent up tick in private banks stocks from current levels.
Bhatia told CNBC-TV18, “There is scope for valuations to come off in private banks. We have seen a very good rally, some of them have been very good performers. I think right now I would advice caution from here on for most private sector banks in terms of valuations. But till the end of the year I wouldn’t expect more than 10 percent up tick from here. So, right now some degree of caution.”
He further added, “Unfortunately those are the only businesses which seem to demonstrate competence in terms of managing their balance sheet and controlling non-performing assets. So, the market prefers to stick with them even if valuations look stretched. I don't expect people to exit the space, but given that the recent strong price performance valuation from here on is mostly capped.”