Banking stocks have been among the standout performers during periods of market weakness, with many staying relatively resilient even as broader indices slipped. As sentiment improves and credit growth stabilises, analysts see significant upside potential in select bank shares over the next 12 months.
Analysts point to structural strengths in the Indian banking sector — including stronger balance sheets, improving asset quality and rising retail and SME lending — as reasons why these stocks may deliver outsized returns once market confidence returns. While near-term volatility can’t be ruled out, the sector’s fundamentals are seen as solid compared with past cycles when high NPAs and weak profitability weighed on valuations.
The specific names of the 7 banking stocks aren’t fully visible in the publicly accessible summary, but based on broader analyst coverage in recent months and other related lists of banking stocks with strong upside views, common top banking names that frequently appear in such bullish outlooks include:
Likely candidates analysts are bullish on
• State Bank of India (SBI) – India’s largest public sector bank with strong credit growth potential as the economy recovers.
• HDFC Bank – A leading private bank with consistent earnings growth and strong franchise value.
• Kotak Mahindra Bank – Known for conservative underwriting and expanding digital footprint.
• ICICI Bank – Broad retail and corporate banking exposure with improving asset quality.
• Axis Bank – Positioned to benefit from expanding loan demand and branch network growth.
• Bank of Baroda – A large PSU bank with improving efficiency and credit momentum.
• Smaller or mid-tier banks – Analysts often highlight opportunities in undervalued mid-sized lenders that may re-rate as credit flows normalise.
Analysts’ return projections stem from a combination of valuation re-rating potential, improving earnings prospects and broader market cyclical revival. Investors may see gains of over 23% over a year if sector sentiment strengthens and macro conditions remain supportive.
