By Admin 
India’s BFSI (Banking, Financial Services and Insurance) sector has gone through tremendous changes in the last few years and its speed is going to be even faster. The latest report of well-known brokerage firm Motilal Oswal states that this sector has grown 50 times in two decades.
In the year 2005, where its market cap was only 1.8 lakh crores, it is estimated to increase to 91 lakh crores by 2025. There are many factors behind this major change, such as digitization, the rise of fintech companies, improvement in government policies and the growing population of the country.
Motilal Oswal expressed confidence in which stocks
In the midst of this growth story, Motilal Oswal has also told his top stock pics of BFSI sector. Talking about large cap, veteran names like ICICI Bank, HDFC Bank and State Bank of India (SBI) are included. At the same time, Federal Bank and AU Small Finance Bank have been described as favorite among mid-size banks. In the category of NBFC (Non-Banking Financial Companies), Shriram Finance, Homefarent, PNB Housing Finance and L&T Finance Holdings have been considered as the top choice.
private banks should be better
The report also said that the performance of private banks has been better than public sector banks. Private banks can register a growth of about 18.8 percent by FY26-27, while the growth of government banks can be limited to 11.7 percent. The biggest reason for this is the strong balance sheet of private banks, their aggressive strategy regarding efficient cost management and technology.
BFSI sector stake in the Nifty 50 index has also increased considerably over time. While it was only 14.6 percent in 2004, it has now reached 37.9 percent by April 2025. HDFC Bank’s stake has increased from 1.7 per cent to 13.3 per cent, while ICICI Bank’s stake has reached 9.1 per cent. In contrast, the share of public sector banks has fallen to only 2.8 percent, in which only SBI is strong. The share of NBFCs has also decreased, which was 10.3 per cent in 2020 and has now come down to 4.8 per cent, the main reason for HDFC Ltd’s merger in HDFC Bank.
The report also mentions that foreign investors (FIIs) have been confident of India’s BFSI sector for years. In 2010, the value of FII Holdings, where 2 trillions were 2 trillions, increased to 23.7 trillions by December 2024. FII has been constantly interested in major private banks like HDFC Bank and ICICI Bank, as these banks have shown stable growth, good asset quality and technical leadership in every cycle.
However, due to recent global conditions, such as high interest rates and tight liquidity, there has been a slight decline in mid and small cap companies. Overall, India’s BFSI sector has entered a new era and brokerage like Motilal Oswal believes that there are still tremendous possibilities hidden in it.
disclaimer: (Here the information provided is being given only for information. It is necessary to tell here that the investment market is subject to risks. Always consult expert before investing money as an investor. There is never advice from Abplive.com to invest money here.)
Source link