Top Banking Stock Recommendations
Motilal Oswal Financial Services has shared its latest list of top banking stocks to buy this festive season. The brokerage firm believes these stocks have strong growth potential due to improving asset quality, solid quarterly performance, and better financial stability. According to its latest report, investors can expect gains of up to 28% from these five top-rated banking shares.
1. DCB Bank
Motilal Oswal continues to recommend a ‘Buy’ on DCB Bank with a target price of ₹165, offering an upside of 28%. The bank posted a strong quarterly performance supported by lower provisions, higher net interest income, and controlled expenses. Margins improved slightly, and asset quality showed progress with fewer slippages. The brokerage expects the bank’s credit cost to remain under 45 basis points for the year, projecting a Return on Assets (RoA) of 1.01% and Return on Equity (RoE) of 15.3% for FY27.
2. ICICI Bank
ICICI Bank remains one of Motilal Oswal’s top picks with a ‘Buy’ rating and a target price of ₹1,700, suggesting an 18% upside. The bank delivered strong numbers with stable margins, low provisions, and improved efficiency. Its focus on high-yield assets and technology adoption has supported steady growth. The brokerage estimates a RoA of 2.3% and RoE of 17% for FY27.
3. Federal Bank
Federal Bank also retains a ‘Buy’ rating with a target price of ₹250, reflecting an 18% upside. The bank’s improved performance was driven by better net interest margins and reduced funding costs. Asset quality improved as slippages fell, and earnings estimates were raised by over 5%.
4. HDFC Bank and RBL Bank
Motilal Oswal remains positive on HDFC Bank with a ‘Buy’ target of ₹1,175 (17% upside), noting healthy earnings, loan growth, and strong treasury gains. RBL Bank also holds a ‘Buy’ tag with a ₹350 target (17% upside). The brokerage expects strong future performance after Emirates’ investment of USD 3 billion for a 60% stake, boosting expansion opportunities.
