Here's a curated basket of bank, NBFC must have stocks for your portfolio

Banks are well positioned to outperform, supported by robust balance sheets and the ability to navigate macro economic uncertainties, said a report from Motilal Oswal Securities

Indian equities market has outperformed its global peers recovering all the losses triggered by US President Donald Trump's reciprocal tariffs earlier this month. The benchmark NSE Nifty50 index is trading around 2.3 per cent above its April 2 closing levels, following the rally witnessed in the last four sessions. 

 

Amid this, analysts at Motilal Oswal Financial Services (MOFSL) believe that banks are well-placed to outperform, on the back of healthy balance sheets and their resilience during the macroeconomic volatility.

 

In addition, non-banking financial companies (NBFCs) are also expected to witness a bounce back after the ongoing moderation phase, driven by interest rate cuts and an easing of regulatory stance going ahead.

 

 

Given the attractive valuations and a promising growth trajectory, MOFSL has created a portfolio of five bank and NBFC stocks that have the potential to move up by 10 to 15 per cent in the next 12 months. The brokerage firm has placed equal weightage on each of the 5 stocks in the basket named FinRise.    Top 5 bank and NBFC stocks to have in your portfolio:

 

Kotak Mahindra Bank: MOFSL said Kotak Mahindra Bank has delivered a strong performance over the past one year, supported by strong margins and steady profitability. With major regulatory restrictions now removed by the Reserve Bank of India (RBI), the brokerage expects a pick-up in business growth and underlying profitability, along with stronger traction in the consumer banking segment.

 

Cholamandalam Investment and Finance Company: According to the report, Cholamandalam is well-positioned to benefit from interest rate cuts, along with management guidance for improvement in net interest margins (NIMs) and better margins in the vehicle finance segment by FY26. The company has entered the personal and business loans space through its digital platform. Given its diversified portfolio and focus on NIM expansion, Cholamandalam's assets under management (AUM) are expected to grow at a healthy CAGR of 24 per cent over FY24-27E.

 

One97 Communications (Paytm): The company has successfully sailed through regulatory hurdles while maintaining a strong merchant base of 43 million and scaling its loan distribution business through FLDG (First Loss Default Guarantee) partnerships. With around 85 per cent of its gross merchandise value (GMV) coming from merchants, Paytm expects a 24 per cent GMV CAGR and 25 per cent revenue CAGR over FY25-27, primarily through financial services.

 

Poonawala Fincorp: MOFSL highlighted Poonawalla Fincorp's plans to become a multi-product lender, increasing its offerings from four to ten loan types. In addition, the NBFC aims to open 400 new branches in a phased manner starting from the first quarter of FY26. This expansion is expected to help the company grow its AUM by 30 to 40 per cent between FY26 and FY27.

 

PNB Housing Finance: The brokerage firm noted that PNB Housing is confident of achieving a retail loan book of around ₹1 trillion by FY27, driven by stable demand for the home loan segment and a revival in the Pradhan Mantri Awas Yojana (PMAY) scheme. Despite competitive prices, the company expects its NIMs to improve to around 4 per cent by FY27, supported by a better product mix. Its focus on the expansion of affordable housing and retail segment is likely to support future growth.