Shibani Sircar Kurian on what to buy in PSU bank and auto stocks

economictimes.indiatimes.com:

Shibani Sircar Kurian, Senior EVP, Fund Manager & Head -Equity Research, Kotak Mahindra AMC, says focus will be towards the slightly larger PSU banks given their ability to defend market share as well as their ability to raise capital which will again help in terms of loan growth as well as deposit growth. The auto pack is fairly well placed. There are pockets where growth remains strong, margins are improving because lower commodity costs continue to play out and in terms of portfolio positioning in the auto and auto ancillaries space, Kotak continues to be overweight.

Let us begin with PSU banking space itself because that seems to be the flavour right now. Which are the names, if any, that still look very good? Will you stick your neck out and talk about only the largecap PSU banking names or is it getting a lot wider?
While I cannot talk about specific names, let us discuss the PSU banking pack as a whole. Over the last year or so, there has been tailwinds in the overall banking sector and there has been improvement in terms of profitability in terms of return on assets for the bank.
The second most important factor is that we are now in a scenario where credit costs have been extremely benign and then together with the news that has come in today in terms of the bond inclusion, overall it does look that from interest rate perspective and bond yield perspective, there is the much needed downside support that has come through.

Unlock Leadership Excellence with a Range of CXO Courses

So, all of these factors are resulting in the