Waning asset quality concerns, possibility of rate cuts and expectations of stable earnings growth are prompting investors to buy banking shares over the past one month. Banks - which command the highest sectoral weightage on benchmark Sensex - have gained over 24% during the period. One of the main reasons for share-price gain is the spate of better-than-expected third quarter earnings of banks. Net profits ICICI Bank, HDFC Bank, YES Bank, Axis Bank, Federal Bank and Bank of Baroda, among others, have risen 20-40% during the December quarter. Third quarter earnings of banks came as a pleasant surprise to investors as many of them reported lower bad loans.
Source: Economic Times
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