Not too concerned about Goldman downgrading; SBI one of the top bets in portfolio: Ashi Anand
Ashi Anand, Founder, IME Capital, says they are very comfortable with SBI. It is one of the top bets in their portfolio and they are not too concerned about Goldman downgrading SBI to sell and cutting target price. While deposits are relatively tough to get into, a lot of the credit costs have normalised, and there is still attractive growth coming in at attractive levels of profitability and valuations at about 1.3 times the book.
Anand also said IME Capital has recently increased consumption and FMCG weights.
The bank index has largely underperformed the Nifty. To date, they have dragged nearly 4.5%. In the PSU banking space, what is the gap between deposits and loan growth and the peaking of profitability? A Goldman Sachs note has downgraded SBI to sell and slashed its target price. What is your view on the PSU banks?
Ashi Anand: Banking as a space has been underperforming and the core reason behind the underperformance has been that it has been tough to raise deposits over the two to three quarters. And because of the struggle to raise deposits, advance growth has also slowed down. This has led to some near-term pressure. Because of that, growth is slightly lower than expected and there is some amount on NIMs.
That said, banking is a space we are very comfortable in from a long-term perspective. In the overall market construct, from a three- to five-year perspective, if you are trying to identify sectors and companies with the ability to grow at 13%, 15%, and 18% that are available at attractive valuations,
