Macquarie picks pvt banks over other financials, upgrades Kotak Mahindra Bank, City Union Bank

City Union Bank

20/06/2024 05:37

** Private lenders Kotak Mahindra Bank  KTKM.NS  and City
Union Bank  CTBK.NS  up 1.6% and 4.4% each
    ** Both stocks among top gainers on the Nifty private bank
index  .NIFPVTBNK , which is up 0.1%
    ** Macquarie upgrades KTKM and CTBK to "outperform" from
"neutral"
    ** Prefers private banks over public sector banks (PSU),
non-banking financial cos (NBFCs), insurance and fintech cos,
"owing to regulations and declining fundamentals"
    ** Adds, private sector banks are at attractive valuations,
see no adverse asset quality outlook
    *** Adds, a delayed rate cut cycle further cushions their
net interest margin (NIM) in the near term
    ** Despite lower-growth environment, expect private banks to
report healthy returns on assets and equity as they are less
affected by regulations - Macquarie
    ** Private banks  .NIFPVTBNK  and public sector banks
 .NIFTYPSU  up ~3% and ~31% YTD, respectively, compared to an 8%
rise in Nifty 50 index  .NSEI 
    

 (Reporting by Dimpal Gulwani in Bengaluru)
 ((dimpal.gulwani@thomsonreuters.com))