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Showcasing a sharp earnings turnaround on asset quality improvements, robust margins and strong loan book growth in a multi-year credit upcycle, the combined net profit of all 12 PSU banks has zoomed nearly 4.5 times in just 3 years to record high levels of Rs 141,203 crore in FY24.On a year-on-year basis, the profit pool of PSU banks has surged 35% from Rs 104,649 crore in FY23. India's largest lender the State Bank of India (SBI) alone contributed over 40% of the total earnings with an annual profit of Rs 61,077 crore. <iframe title="Sharp surge in profit pool of PSU banks" aria-label="Table" id="datawrapper-chart-PorzP" src="https://et-infographics.indiatimes.com/graphs/PorzP/1/" scrolling="no" frameborder="0" style="width: 0; min-width: 100% !important; border: none;" height="515" data-external="1"></iframe><script type="text/javascript">!function(){"use strict";window.addEventListener("message",(function(a){if(void 0!==a.data["datawrapper-height"]){var e=document.querySelectorAll("iframe");for(var t in a.data["datawrapper-height"])for(var r=0;r<e.length;r++)if(e[r].contentWindow===a.source){var i=a.data["datawrapper-height"][t]+"px";e[r].style.height=i}}}))}();</script>SBI's quarterly profit of Rs 20,698 crore was also the highest reported by any company in this quarter, higher than both RIL's Rs 18,951 crore profit and HDFC Bank's Rs 16,512 crore.Other top contributors were Bank of Baroda (Rs 17,788 crore), Canara Bank (Rs 14,554 crore) and Union Bank of India (Rs 13,649 crore).UCO Bank and Punjab and Sind Bank were the only two PSU banks to have reported a decline in profit as compared to the previous financial year.Over the years, the balance sheets of PSU banks have seen a dramatic turnaround from posting a total net loss of Rs 85,390 crore in 2017-18 to being Dalal Street's favourite in this bull market.The financials of 'sarkari' banks are now largely in line or converging towards their private banking peers. As a result, the Nifty PSU Bank index has rallied over 76% in the last one year as against a modest 8% rise seen in Nifty Private Bank index. Relatively cheaper valuations and a low free float also did the trick as far as stock price performance is concerned.Also read | Lok Sabha election or China effect? 4 reasons why Sensex has fallen 2,000 points in MayWhy the tide has turned for PSU banksThe rags-to-riches story of PSU banks is seen as a result of multiple triggers starting from banking reforms such as the establishment of Bad Banks to move long outstanding NPAs out of their books, implementation of Insolvency & Bankruptcy Code which helped lenders recover debts and, merger of several PSU banks.Not only have PSU banks grown their loan books, but they have also improved margins in the past few quarters. "These expanded margins are the result of a gradual rise in deposit rates, alongside a rapid change in lending rates. This widening spread propelled yields and margins. Improving margins have allowed banks to write off the provisions made for loans off the balance sheet, leading to strengthening financials and improved prospects for growth," analysts at Ambit Capital say.PSU banks have also built retail capabilities and have caught up with private banks on CASA ratios.Analysts expect PSUs to take the lead in infrastructure financing and corporate project loans. PSU banks have also typically enjoyed lower loan-deposit ratios, allowing them to push loan growth."I am betting mainly on PSU banks. I believe even though there is a lot of buzz that PSU banks have been done with their rally, I believe banks like SBI, PNB will continue their rally going forward. I am expecting their numbers to improve. I am generally bullish on the PSU sector and specifically want to focus on banks. PNB and SBI are my picks," says Abhijit Chokshi of Stockifi.In the last one year, at least four PSU banks - PNB, IOB, Central Bank and Bank of Maharashtra - have more than doubled investor wealth.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

Brokerage BofA Securities maintained a buy rating on Varun Beverages, Jefferies recommended a buy on Zomato, Morgan Stanley has an Equal Weight rating on AB Capital and Motilal Oswal recommended a neutral stance on UPL.We have collated a list of recommendations from top brokerage firms from ETNow and other sources:BofA Securities on Varun Beverages: Buy| Target Rs 1650BofA Securities maintained a buy rating on Varun Beverages post March quarter results but raised the target price to Rs 1650 from Rs 1600 earlier.The March quarter earnings beat expectations, and the management is looking ahead at a strong CY24.The company is gearing up for a good peak season. South Africa's capacity is expected to be ready before its peak season in 4Q.Jefferies on Zomato: Buy| Target Rs 230Jefferies maintained a buy rating on Zomato but raised the target price to Rs 230 from Rs 205 earlier.The company has enjoyed a great run so far and the global investment bank expects more modest returns in the near term.The management is top-notch, which is why Jefferies has retained its buy rating.Easy money is made and return expectation should be more modest at least in the next few months.Morgan Stanley on AB Capital: Equal Weight| Target Rs 200Morgan Stanley has an Equal Weight rating on AB Capital but raised the target price to Rs 200 from Rs 190 earlier.The adjusted PAT was largely in line with estimates. The lending businesses' performance remained muted and the non-lending businesses was better than estimates.The guidance was strong across businesses. The global investment bank slashed its consolidated EPS estimates by 4% for FY25, 2% for FY26 and 2% for FY27.Motilal Oswal on UPL: Neutral| Target Rs 560Motilal Oswal maintained its neutral stance on UPL with a target price of Rs 560. The domestic brokerage firm expects H1FY25 to remain challenging for the global agrochemical industry.H2FY25 is expected to witness a recovery in overall demand and a pricing scenario globally. Considering short-term challenges, cash flow generation and debt repayments remain key monitorables.(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)

Indian market is expected to trade higher on Tuesday tracking positive global cues.The Nifty future closed positive with gains of 0.38% at 22224 levels. India VIX was up by 11.53% from 18.47 to 20.60 levels.Volatility spiked to 21.5 zones to hit its 19-month high which created swings in the market, suggest experts. “VIX needs to fall below 17-18 zones for some stability and smoother ride in the market,” Chandan Taparia, Analyst-Derivatives at Motilal Oswal Financial Services Limited, said.On the weekly options front, the maximum Call OI is placed at 22300 and then towards 22500 strikes while the maximum Put OI is placed at 22000 and then towards 21800 strikes.Call writing is seen at 22300 and then towards 22400 strikes while Put writing is seen at 21800 and then towards 22000 strikes.“Options data suggests a broader trading range in between 21500 to 22500 zones while an immediate range between 21900 to 22300 levels,” said Taparia.“Now the index has to hold above 22050 zones for a bounce towards 22222 then 22350 zones whereas supports are placed at 21950 then 21800 zones,” he recommended.We have collated a list of stocks from the F&O basket along with cash market from various experts for traders who have a short-term trading horizon:Expert: Kunal Bothra, Market Expert told ETNowHindustan Copper: Buy| Target Rs 400| Stop Loss Rs 350BHEL: Buy| Target Rs 300| Stop Loss Rs 270Vedant Fashion (Manyavar): Buy| Target Rs 1100| Stop Loss Rs 950Expert: Nooresh Merani, an independent technical analyst told ETNowL&T: Buy| Target Rs 3600| Stop Loss Rs 3240Tata Steel: Buy| Target Rs 180| Stop Loss Rs 158Container Corp: Buy| Target Rs 1200| Stop Loss Rs 970(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)

Just hours after India signed a 10-year agreement to manage the Chabahar Port in Iran, the United States issued a warning, underscoring the "potential risk of sanctions" for "anyone" engaging in business dealings with Tehran.Vedant Patel, Principal Deputy Spokesperson for the US State Department, however said that the US would let the Indian government speak on its foreign policy objectives."We are aware of these reports that Iran and India have signed a deal concerning the Chabahar Port, I would let the government of India speak to its own foreign policy goals, vis-a-vis the Chabahar Port as well as its own bilateral relationship with Iran," Vedant Patel said in the press briefing on Monday (local time)."I would just say...US sanctions on Iran remain in place and we will continue to enforce them," he said."Any entity, anyone considering business deals with Iran, they need to be aware of the potential risk they are opening themselves up to, potential risk of sanctions," Patel said.India-US relation has been on 'friendly' terms with officials from both sides acknowledging the deepening ties between India and the United States. The relation is not only shaped by shared interests and common ambitions but also by the personal bond between their leaders Prime Minister Narendra Modi and President Joe Biden.India and Iran signed the 10-year contract on Monday for the management of Chabahar port, finalising what’s seen as a gamechanger in regional connectivity, rivalling China’s Belt and Road Initiative and being an alternative to Pakistan's Gwadar port.The decade-long lease agreement enhances the bilateral relations between the two nations and fosters confidence and trust among regional trading communities.The port serves as India’s crucial connection to Afghanistan, Central Asia, and the broader Eurasian region. There are plans to integrate Chabahar with the International North South Transport Corridor (INSTC), linking India to Russia through Iran. This initiative will allow India to circumvent Pakistan and reach Afghanistan, opening up access to Central Asian countries.The deal was signed between Indian Ports Global Limited (IPGL) and the Port & Maritime Organisation (PMO) of Iran for operating the Shahid-Behesti port within the Chabahar Port Development Project.Under the contract, IPGL will equip and operate the port for the duration of the contract. At the end of the 10-year period, both sides will extend their cooperation in Chabahar. IPGL will invest about $120 million in equipping the port, officials said. India has also offered a rupee credit window equivalent to $250 million for mutually identified projects aimed at improving Chabahar-related infrastructure, they said.Foreign minister S Jaishankar hailed the pact and said the US didn’t have any concerns regarding the matter.“The US has no issues with Chabahar,” he said in Mumbai. “And frankly, if something’s between me and Iran, it’s between me and Iran.”India had been trying to convince Iran for many years about the need for a long-term agreement, he said.The Chabahar Port, a flagship project between India and Iran, plays a vital role as a transit hub for trade with landlocked Afghanistan and Central Asian nations. India has played a significant role in both the development and operation of this port.Investing in its infrastructure, the Indian government has worked to enhance the port's facilities, making it a feasible route for transporting Indian goods to Afghanistan and Central Asia.(with ANI inputs)

Xiaomi Corp. aims to begin making and selling a sport utility vehicle similar to Tesla Inc.’s Model Y as early as 2025, embarking on a major new expansion with production of its debut SU7 electric car set to reach about a 100,000 units this year.Xiaomi is approaching full initial capacity and is working now to increase output to accommodate demand, people familiar with the matter said. The company benchmarked its envisioned SUV against Tesla’s during development, the people said, asking not to be identified discussing a private project.An SUV would mark a big expansion of Xiaomi’s $10 billion EV endeavor, spearheaded personally by billionaire co-founder Lei Jun. The company is trying to reduce its reliance on a volatile smartphone market dominated globally by Apple Inc., though with EVs it’s getting into a crowded arena and taking on established rivals Tesla and BYD Co.It’s unclear what specifications and pricing Xiaomi envisions for the SUV — a type of vehicle gaining in popularity across China. The company’s plans for production, first reported by local media outlet Yicai, could also shift depending on how it progresses on capacity, the people added. Representatives for Xiaomi didn’t respond to emails and a phone call seeking comment.110098967Discussions about an SUV began as far back as when Lei announced in 2021 that EVs represented his final major entrepreneurial effort, one of the people said. But the company eventually decided to move first on the SU7, a $30,000-plus sedan with a design aesthetic similar to Tesla’s Model 3 and the Porsche Taycan.Xiaomi doesn’t anticipate the SUV going into mass production until late 2025 at the earliest, when it completes construction on a second phase of its assembly factory in Beijing, said one of the people. For now, it’s prioritizing production of the SU7 as it only has the capacity to make fewer than 10,000 deliveries a month, the person said. Xiaomi, which gets more than 60% of its revenue from smartphones, has been trying to diversify in part because of sluggish device demand in its home market.Yet it joins scores of players vying for a slice of the Chinese EV market — the world’s largest, but one where margins have compressed as Tesla and BYD lead a price war during a period of slowing growth. Apple nixed its own long-incubating EV project after failing to overcome challenges in adapting its technological expertise to a new field of manufacturing.Xiaomi’s SU7 series received close to 90,000 confirmed orders as of the end of April — about a month after the debut in late March. Xiaomi’s stock has risen some 30% since the SU7’s debut and is now close to its highest level in about two and a half years.Its EV business could break even in 2026 — two years ahead of a previous estimate — because of improving capacity and a positive market reception for premium models, HSBC Qianhai Securities’ analysts Frank He and Steven Wang wrote in a memo last week.They expect the company to more than double shipments to 240,000 units in 2025. “The capacity bottleneck will start to ease in the third quarter of 2024,” they wrote.

Fund managers made fresh purchases in companies that could benefi t from the strength in global economies, including the US. They increased exposure to metals, commodities and oil & gas. Fund managers believe the Fed is likely to cut rates later this year, which will lead the US dollar to depreciate resulting in rise in commodity prices, subsequently leading to higher realisations. Vedanta, Hindalco, NMDC, GAIL India and ONGC were among the top picks in that space. Some leading mutual funds also lapped up Kotak Mahindra Bank, whose shares have been beaten down after the Reserve Bank of India’s ban on the private lender from issuing new credit cards and onboarding new customers through mobile and online banking, and the exit of joint managing director KVS Manian. Some funds bought shares of Axis Bank, while sold ICICI Bank and Jio Financial Services. 110098572

Mumbai: Shares of many companies with higher foreign ownerships have been under pressure amid the heightened selling of Indian stocks by overseas investors so far in May.Foreign portfolio investors (FPIs) have sold shares worth over ₹22,000 crore this month after pulling ₹21,524 crore out of Dalal Street in April. More than 100 stocks where FPIs hold over 5% stake as of March 31, 2024, have declined between 10% and 30% in last one month, compared to a 1.7% fall in benchmark Nifty."In the present circumstances, FPIs are adopting a risk-off strategy, foreseeing significant volatility leading up to the general election," said G Chokkalingam, founder of Equinomics Research. "Investors should consider keeping FPI-heavy stocks limited in their portfolios until the elections are over."FPI-heavy stocks like Aster DM Health, Sonata Software, Paisalo Digital, Gujarat State Petronet, Coforge, and Birlasoft have dropped between 20% and 30% in the past month. While selling by foreign investors could have contributed to the drop, analysts said weaker-than-expected results in some of them resulted in broad-based selling across investor categories.110098380Several large-cap stocks with higher-than-average FPI holdings, including Larsen & Toubro, HCL Technologies, Kotak Mahindra Bank, Titan, and DLF, among others, have declined more than 10%. HDFC Bank, Infosys, and Bajaj Finance have fallen over 5% in just one month. "FPI-heavy larger stocks have not given any returns to investors in the last two to three years," said Joseph Thomas, head of research at Emkay Wealth Management. "Since no significant movements have taken place in these stocks, it may be advisable to stay invested; or for better price performance, mid-caps could be considered."Foreign investors are selling Indian stocks in the run-up to the general election, a deviation from the trends on the previous two occasions. In 2019, FPIs purchased shares worth nearly ₹25,000 crore in the two months leading up to the election results. In 2014, they acquired shares worth ₹36,500 crore in the two months preceding the elections.Some FPIs are pulling money out of Indian stocks and reallocating to China and Hong Kong, which are trading at cheaper valuations compared to most global markets."Aggressive selling by FPIs has been triggered by the outperformance of China and Hong Hong during the last one month and the underperformance of India," said VK Vijayakumar, chief investment strategist at Geojit Financial Services. Hong Kong's benchmark Hang Seng Index has surged by over 16% in one month and 18% in two months. China's Shanghai Composite has gained 4% and 15% in the last one month and two months, respectively.