Top 10 Stock Picks From BFSI Sector In December 2022 By Leading Brokerages

In December 2022, top brokerages initiated coverage on various stocks from across the sectors with a buy. Among these stocks, a number of stocks are from the BFSI (Banking, Financial Services and Insurance) sector. Here we have listed the top 10 stock picks from the BFSI sector on which the brokerage has placed a buy call for high returns. These stocks are good to invest in 2023 for long-term gains.

BFSI Sector Stocks Rated "Buy" for High Returns By Top Brokerages

Sr.No	Stocks	*CMP	Target Price	Potential Upside	Rated By
1	SBI Life Insurance	1224.6	1600	31	Motilal Oswal
2	IIFL Finance	442.8	604	37	Hem Securities
3	HDFC AMC	2075.85	2600	26	ICICI Direct
4	Can Fin Homes	489.6	630	29	Motilal Oswal
5	ICICI Bank	878.9	1225	40	Emkay Gloabl
6	HDFC Bank	1597.65	1908	20	Anand Rathi
7	State Bank of India	574	700	31	ICICI Direct
8	IndusInd Bank	1147.85	1450	27	ICICI Direct
9	Bank of Baroda	169.05	220	31	ICICI Direct
10	Indian Bank	271.55	335	24	ICICI Direct

*CMP - Current Market Price

Risk reward still favours PSU bank valuations...

According to the ICICI Direct, A stellar run-up by PSU banks had all eyes glued towards them. We tried to analyse the factors leading to the rally and what is in store ahead. Bank Nifty gained ~28% whereas PSU banks were up 74% in the last six months (as of December 21, 2022). Post the phase of significantly higher GNPA, treasury MTM losses, lower capital & sub-par growth, there has been a turnaround with comfort on asset quality; reversal of treasury losses, credit growth pick-up and just adequate capital position for most of them. Despite the decent rally, valuation still look reasonable for PSU banks. 

ICICI Direct said, "Going ahead, the RoA for large PSU banks is seen inching towards 0.8-1% gradually. With a recovery in growth and stable asset quality, PSU banks are set for a further re-rating. Large PSU banks (SBI, BoB, Canara Bank) are trading at ~0.8-1x P/BV, which paves the way for a further re-rating as peak valuations remain at ~1.2-1.5x in FY12-14. Mid-sized and small banks, currently trading at 0.5-0.7x P/BV, touched ~1x then. We remain positive on PSU banks, with upsides expected to continue in the medium term horizon."

Disclaimer

The stocks have been picked from the brokerage reports of top brokerage firms. Greynium Information Technologies, the Author, and the respective Brokerage house are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to consult with certified experts before making any investment decision.