Axis Securities, a Mumbai-based investment and brokerage firm in India, has released its latest long-term stock recommendations following the Q4 FY25 earnings. The company has highlighted four banking stocks—ICICI Bank, HDFC Bank, State Bank of India (SBI), and City Union Bank—as top picks for long-term investment. Despite mixed Q4 results across the sector, these banks are expected to perform strongly over FY25–27, driven by robust fundamentals, improving margins, and healthy loan growth.
Mumbai-based Axis Securities, one of India’s leading stock broking and investment advisory firms, has issued fresh recommendations for long-term investors following the Q4 FY25 results. The firm has advised buying four banking stocks—ICICI Bank, HDFC Bank, State Bank of India (SBI), and City Union Bank—based on strong fundamentals and positive future outlooks.
The Q4 FY25 banking sector results presented a mixed performance. While large banks showed stronger-than-expected Net Interest Margins (NIMs), overall credit growth remained modest at 11% year-on-year. Notably, retail and SME loans contributed significantly to this growth, especially among public sector banks, while private banks faced competitive pricing pressure.
Despite this, Axis Securities noted that deposit growth remained stable and broadly aligned with credit expansion, registering a 12% YoY rise. Larger banks reported improved Current and Savings Account (CASA) ratios, benefiting from seasonal inflows. However, small finance banks and those with heavy Microfinance (MFI) exposure continued to see margin compression and elevated slippages.
Axis Securities’ Top Banking Stock Picks:
- ICICI Bank – Buy | Target Price: ₹1,650
The bank demonstrated healthy credit growth and robust asset quality. ICICI remains Axis Securities’ top choice among banking stocks. - HDFC Bank – Buy | Target Price: ₹2,250
With expected loan and deposit CAGR of 13% and 18% respectively through FY27, HDFC Bank is forecasted to achieve RoA in the 1.9%–2.1% range. - SBI – Buy | Target Price: ₹1,025
India’s largest lender is projected to grow corporate loans by 12–13% in FY26 and maintain a strong Return on Equity (RoE) of 14–15%. - City Union Bank – Buy | Target Price: ₹225
Despite higher operational costs, Axis Securities expects consistent RoA of 1.5%–1.6%, supported by steady NIMs and strong fee income.
These stock picks reflect Axis Securities’ confidence in the underlying strength of India’s banking sector, especially among large and stable players with robust credit profiles.
