SBI Securities picks Axis Bank, Karur Vysya Bank, Ujjivan SFB, Bajaj Finance

SBI Securities has recommended a buy-on-dip approach in select banking and NBFC stocks, with Axis Bank, ICICI Bank, Karur Vysya Bank, Ujjivan Small Finance Bank, Bajaj Finance and Shriram Finance among its top picks. Analyst Sunny Agrawal expects a broad earnings recovery across sectors in FY27 and FY28, with banking and NBFCs best placed over the next three to six months.

On HDFC Bank, Agrawal said the stock trades at reasonable valuations but a gradual recovery could take two to three quarters. He advised investors with a longer horizon to consider HDFC Bank, while those building positions over three to six months could focus on ICICI Bank and Axis Bank. Among mid-sized banks, he favoured Karur Vysya Bank for its strong quarterly numbers. He put a fair value of around Rs 85 on Ujjivan SFB.

In NBFCs, Agrawal cited healthy credit growth of 15-25 per cent through FY27. He said a Japanese conglomerate's infusion into Shriram Finance could lower borrowing costs and support net interest margin expansion. Bajaj Finance reported strong numbers and any weakness could be a buying opportunity, he added. Defence companies like Bharat Electronics and L&T, along with power-linked firms like Siemens Energy and Cummins India, are also preferred by SBI Securities.