Banking sector has come under tremendous stress in last one year. Valuations of a number of the stocks in both public and private sectors have turned mouth watering.
Banking and finance as a sector holds importance, because it has a weightage of more than 30% in the Sensex. The S&P BSE banking index plunged over 200th compared with a 16% fall within the BSE Sensex during the same amount.
Most of the private and public sector players have corrected considerably from their recent highs, however consultants said private sector lenders are better placed to deliver smart returns compared with their PSU counterparts.
The Union Budget 2016 failed to cheer the PSU banks despite the Rs 25,000 crore budget allocation for recapitalisation, that according to most consultants, is far less than the actual demand, which has been projected at more than Rs 1,00,000 crore.
