PSU bank shares make a comeback on JPMorgan’s index inclusion decision
PSU bank shares made a robust comeback on September 22 after a bruising selloff in the previous session, following JPMorgan’s decision to include Indian government bonds in its emerging-market index. The Nifty PSU Bank index was trading 1.79 percent up at 10.10 am, with all its 12 components trading in the green.
Analysts expect a significant boost to the domestic financial ecosystem if Indian government bonds are included in all three major EM bond indices. This could lead to total flows of at least $40-50 billion in the medium term, according to Satyakam Gautam, Rates trader at ICICI Bank.
However, some analysts are urging caution with regard to the PSU bank space. They warn that the smaller PSU banks have low floating stock and could fall sharply if a block comes to the market. They also point out that PSU banks such as UCO Bank, Punjab & Sind Bank, and Bank of Maharashtra have over 95 percent government shareholding and are on the divestment radar.
Overall, the outlook for PSU bank shares is mixed. Some analysts are bullish on the segment, citing the undervalued valuations and the readiness of PSU banks to fund the growth of the Indian economy. Others are more cautious, pointing to the risks of investing in smaller PSU banks and the potential for divestment in some of the larger banks.
Investors should carefully consider the risks and rewards before investing in PSU bank shares.
- 22 Sep
HDFC Bank stock expected to re-rate in next 12-18 months, says Motilal Oswal’s Nitin Aggarwal
Aggarwal is bullish on HDFC Bank's long-term prospects, but he believes that investors should wait and see how the bank executes in the near term.
- 22 Sep
Sai Silks’ IPO attracts lukewarm response, analysts raise concerns
Sai Silks Kalamandir's IPO received a lukewarm response with a subscription rate of just 0.07 times. Analysts have raised concerns about the company's high debt levels, intense competition in the industry, and the fact that half of the issue size is an OFS. The company also has 30 percent of its promoter holdings pledged. Despite these concerns, the company's management is confident about its growth prospects.
- 22 Sep
SEBI penalizes 11 entities for non-genuine trades in illiquid stock options segment
The Securities and Exchange Board of India (SEBI) has penalized 11 entities for non-genuine trades, fined 2 entities for flouting disclosure rules, and suspended the registration of 1 research firm for violating regulatory norms. SEBI's actions are a reminder to market participants that they must comply with all regulatory requirements. Investors should be aware of these risks and take necessary precautions to protect themselves.
- 22 Sep
Zaggle Prepaid Ocean Services Stock Makes Weak Debut, Analysts Recommend Selling
Zaggle Prepaid Ocean Services stock made a muted debut on bourses on September 22, listing at a premium of just 0.6% over the IPO price. Analysts have recommended selling the stock on the opening day, citing its high P/E valuation, debt-to-equity ratio, and negative cash flow.
- 22 Sep
Market Summary for September 22, 2023
Indian equity markets closed in the green on September 22, 2023, supported by buying in select banking and automobile stocks. Sectors such as pharma, information technology, and metals were the major drags. Options data suggests a sideways to positive momentum in the near term.