Buy PNB, UCO Bank on correction: Vikas Khemani

Vikas Khemani, President & Co-Head Wholesale Capital Markets at Edelweiss Capital told CNBC-TV18, "We saw somewhat interest building up in most public sector undertaking (PSU) banks and stocks which were kind of beaten down earlier very sharply also recovered in this rally. That typically happens when the stock gets hammered and the mood changes when investors were looking to build some beta in the portfolio and realigning the portfolio."

He further added, "These stocks did very well. After such a stellar performance in a month especially without seeing any significant impact or a change at the ground level in terms of whether it is asset quality or interest rate cycle, there is expectation, but actually it will take some time to take place."

"After such rallies, such kind of correction, profit booking is bound to happen especially when the overall market was looking heavy. So, stocks which went up also would take slightly bigger knock than overall market and I would say these stocks would fall into that category. But in PSU banks if sharp fall comes in this month for whatever reasons, you could look for good risk reward rates from a long-term perspective. If PNB or UCO Bank corrects another 10-15 percent from here then they would be buying opportunities," Khemani said.