Key Points
The Rs 6.76 lakh crore blockbuster rally in PSU bank stocks, which gave 7 multibaggers in last one year, is now staring at a turning point as the Sebi deadline to meet 25% minimum public shareholding (MPS) rule ends this August...
Out of the 7 PSU banks which have more than doubled investor wealth in the last one year, Punjab National Bank (PNB) meets the 25% criteria while Union Bank Of India became compliant last month following a Rs 3,000 crore QIP...
A potential increase in free float can, on one hand, create a supply overhang for share prices to march upwards, but on the other hand it can also allow more investors to recognize the strong fundamentals and value potential of these PSU bank stocks...
Therefore, while low free float may have posed challenges in the past, increasing free float could unlock the full potential of these fundamentally strong stocks and benefit both investors and the companies alike," Shreyansh V.Shah, Research Analyst, StoxBox, said...
PSU banks are well positioned to pursue healthy growth (given ample balance sheet liquidity) and maintain resilient margins as they benefit from residual MCLR repricing..
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