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Jefferies Names Seven Top 'Buy' Ideas in Indian Financial Sector
Global investment bank Jefferies has identified seven of its top investment ideas in India's financial services sector, highlighting a mix of banks, non-banking finance companies (NBFCs), and insurers that the brokerage believes are poised for strong growth.
In a new research note, the firm outlined its picks, providing price targets and key financial projections for each company based on expectations of robust loan growth, improving asset quality, and expanding profitability.
Banking Sector Favorites
Jefferies' selections in the banking space include a mix of leading private and public sector lenders, citing strong deposit growth and stable asset quality as key themes.
- ICICI Bank: Named as Jefferies' top pick, with a price target of ₹1,750. The firm projects 15% loan growth and 13% core profit growth through fiscal 2029, supported by industry-leading retail deposit growth of 15% year-over-year.
- Axis Bank: Carries a price target of ₹1,700. Jefferies forecasts 14% loan and deposit growth through fiscal 2029 and expects credit costs to stabilize.
- State Bank of India (SBI): The state-owned lender has a price target of ₹1,320. Jefferies highlights its sector-leading retail deposit growth of 14% year-over-year and projects 13% loan growth through fiscal 2029.
AdHigh-Growth NBFCs and Insurers
Beyond traditional banking, Jefferies also identified opportunities in the fast-growing NBFC and insurance segments, favoring companies with strong market positions and high earnings growth potential.
- Bajaj Finance: The NBFC has a price target of ₹1,280. The brokerage expects assets under management (AUM) growth of 22-24% and notes it is one of few large-caps where earnings growth could exceed 25% in the coming years.
- Cholamandalam Finance: With a price target of ₹2,100, the firm is expected to deliver 28% earnings per share (EPS) growth over fiscal 2026-2028, according to Jefferies.
- SBI Life Insurance: Jefferies' top life insurance pick has a price target of ₹2,600. The firm anticipates 15% growth in annual premium equivalent and an expansion in its value of new business (VNB) margin.
- Star Health & Allied Insurance: The health insurer carries a price target of ₹725. Jefferies projects 24% EPS growth and 15% gross premium growth over fiscal 2026-2029.
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