Some big banking stocks may see upside in near term: Avinash Gorakssakar

In a chat with ET Now, Avinash Gorakssakar, Head of Research, Miintdirect.com, talks about the banking space.

ET Now: We just wanted your quick view on what one needs to do with the PSU banks right now. I mean private banks is a known story but the sense is that if the rally is to move up and we have seen the likes of Bank of Baroda, Punjab National Bank, SBI do really well from the lows in February, do you think momentum will take most of these banks higher especially the mid-tier PSU lot?

Avinash Gorakssakar: One needs to be a little cautious here because in terms of asset quality, we have seen that one quarter is good, the other quarter is bad. In fact, today two large PSU banks came out with results that were in complete contrast. So, I would say that it would still be a little time. It would be better to give at least one more quarter for this pack to actually perform. More importantly, with the new government coming in, we do not know what kind of changes can happen on the PSU bank front.

Clearly, in terms of asset quality kind of numbers, which actually the previous government was highlighting, it is probably still worthwhile to take a call on some of the larger banks. Especially banks like SBI or maybe PNB or a Bank of Baroda — clearly private banks definitely give you some more comfort. I would not be surprised if an ICICI or an Axis or an HDFC Bank possibly throws up a better upside in the very near term, at least over the next three to six months.