More than banking sector, would bet on insurance companies: Rajen Shah

In a chat with ET Now, Rajen Shah, Chief Investment Officer, Angel Broking shares his view on the banking sector:

ET Now: A couple of banking names that came out with numbers Kotak, Axis, actually IDBI too couple of them disappointing, Axis stable what is the call on these numbers today?

Rajen Shah: Well HDFC, Kotak and Axis all three came out with reasonably fine numbers. Axis was much better actually but if you see HDFC and Kotak asset quality has taken a bit of hit but that is more to do with what is happening in the economy but as soon as the economy turns around we will see this asset quality improving too. But as far as our top pick in this is concerned, we would bet with Axis Bank because it is trading at just hardly 1.5 times the adjusted book so our bet in the banking space would be Axis Bank.

But a number of times in the past also I have mentioned that more than the banking sector one sector which is much more related to banking in the finance business is the insurance business on which we have been sounding very positive that space we continue to like Aditya Birla Nuvo and Bajaj Finserv so if you were to ask me one among the banking space yes it would be Axis but more than banking sector as a whole I would rather bet with insurance companies like Aditya Birla Nuvo and Bajaj Finserv because a huge potential which the insurance sector offers, this stock have got a long long way to go so if I had a choice between even Axis and Aditya Birla Nuvo I would go with Aditya Birla Nuvo because percentage wise Aditya Birla Nuvo would deliver much better returns on Axis Bank.