Private sector banks like ICICI, Asix and HDFC Bank still favourites: Ajay Bagga

In a chat with ET Now, Market Expert Ajay Bagga shares his views on banking space.

ET Now: What is the call on banks?

Ajay Bagga: As the economy picks up, banks are the first play. They are first surrogate that will do well. We have seen a bottoming of the economy, probably corporate restructuring. We have still got two quarters. You will see NPAs going up slightly for two more quarters and then plateauing off.

Private sector banks are still favourites. Investors can be holding positions in the leaders like ICICI, Asix, HDFC Bank.

PSU banks run-up has been strong on the basis of some management calls, but it seem to be getting weaker. On a longer term basis for two to three years, that can be held and will give good returns.

When you have such good well run banks available, both in the leaders as well as the midcap segment, you can start with that. Well run NBFCs can be looked at. Some companies like Shriram Transport will be a good player to own.