Wait and watch for the PSU banking sector: Sethuram Iyer

In a chat with ET NOW, Sethuram Iyer, Chief Investment Officer, Daiwa Asset Management, gives his call on the PSU banking sector

What would you do with the PSU banking lot, do they still appear attractive, would you buy them?

Financial sector as a whole is something which one should look at quite positively because that is one space where if the economy rebounds, the effects will be reflected.

The other factor is that interest rates are heading down and therefore one can look forward to sustained benefits coming in the treasury gains.

The government holdings with the banks are holding but one needs to examine and analyse each bank. Apart from that, the uncertainty is of course in the NPA. The NPAs would definitely start plateauing or probably going down in over the next six to nine months.

But as of now, I believe that NPA is going to be a factor that one needs to watch at least in while we are looking at the third quarter numbers which are going to come out pretty soon.