Best Banking Stocks to Buy in India for Good Returns in 2019

Banking stocks may not have a good growth rate this year, but the returns that they will offer to the investor are phenomenal. Here, are the best banking stocks that are worth investing for good returns in 2019

The rising NPA’s, strict regulatory actions taken by RBI, and economic slowdown, has dampened the investor’s sentiments towards the banking stocks.  But it doesn’t mean it is an unattractive sector to invest in. It means the investors need to be selective or in simple words, the investors need to invest in the stocks that follow an institutionalized approach.

State Bank of India (NSE: SBIN)

The largest state owned bank SBI has witnessed its share of ups and downs. Starting from rising NPA to merger of its subsidiaries to prolonged period of low credit growth to snail paced economic growth; the bank has faced various challenges. But, no one can beat its retail reach and it is one of the banks that boast of high CASA ratio of more than 45% and this has further helped the bank in improving its asset quality. The analyst expects better days ahead.

HDFC Bank (NSE: HDFCBANK)

Its quarterly earnings report says it all. Recently, the company registered the profit of Rs 5,005.7 crore as compared to Rs 5,033 crore consensus estimates by the analysts of Bloomberg. The factors that has resulted into high growth performance include high asset quality, robust cash flows, attractive interest rate policies, all these has resulted into a stock that is worth investing for in 2019.

Kotak Mahindra Bank (NSE: KOTAKBANK )

The aggressive bank which took over ING Group, has created a distinctive niche for itself in this segment. The Kotak bank has reported a rise in consolidated profit of 21% YoY to Rs 1,747 crore.  What makes this stock favorable among the investors is high asset quality, improvement in net margin, its policy of low cost deposit growth, lower NPA as compared to its peers etc. The challenges that this stock may face is to keep pace with the rapid growth rate.

Karur Vysya Bank (NSE: KARURVYSYA)

Despite low quarter earnings, the analysts are bullish in this stock because of its strong fundamentals and reasonable valuations. The bank is taking certain measures like risk based pricing, further improvement in its digital platform. The bank is also reducing the operational cost by shutting down the branches in Mumbai and Delhi. However, the effect of these measures will not be reflected in the results in a near term.