SBI, PSUs to see pressure in terms of asset quality: Kunj Bansal, Sanlam India

In a chat with ET Now, Kunj Bansal, CIO, Sanlam India, shares his view on the Moody's rating downgrade on SBI and Market outlook:

ET Now: We have got a Moody's downgrade on SBI. Do you see significant downside in the stock price?

Kunj Bansal: Yes. Before we go specifically to SBI or its results, let us look at the position in which Moody's is.

Having seen the background of the track record of credit rating agencies over the last so many years in various markets (international and in India), it is a cautious place.

We have already seen that some of the other public sector banks have been downgraded in the past. Now, they have extended it to SBI.

Coming specifically to Indian banking sector or to SBI, the pressure points are there. We will continue to see pressure in terms of asset quality.

Although the recent numbers which came in credit growth of last fortnight from RBI showed a marginal uptick, we will continue to see pressure in terms of lack of business growth and margins.

Therefore, Moody's taking a view that is going to be sustained. It shall not be a one-quarter or two-quarter view.