Overall condition do not look that compelling for banks: Nine Rivers Capital

In a chat with ET Now, Sangeeta Purushottam, Managing Director, Nine Rivers Capital, shares his views on banking stocks.

ET Now: What explains the underperformance by banks in the recent few days?

Sangeeta Purushottam: Banks are the largest sector in the index and we have seen a reasonable rally, particularly in the private sector banks. So there is an element of consolidation or profit taking which is happening in that segment. The other segment, the PSU banks while they looked a little promising a few months ago, the results have actually raised further questions on asset quality.

Although on price to book they look cheap, there still is not enough confidence to come back in and start buying those. So one segment, which is not really being bought and another segment where there is an element of profit taking happening because the macros overall still do not look that compelling. So that really what is playing out with the banks.