Aditya Shah sees PSU banks, SBI and HDFC as key picks amid volatility

Aditya Shah, Founder of Hercules Advisors, believes India's banks are experiencing an inflection point, with growth returning and asset quality stabilizing. He notes that HDFC Bank's loan growth is in line with expectations despite some stock market reaction due to AT1 bond and chairman issues. He also highlights strong deposit growth since the merger and a positive outlook for smaller lenders like RBL, Suryoday, and Ujjivan. While public sector banks are expected to perform well, Shah advises investors to balance opportunity with caution regarding margins, deposits, and global risks.