Good days for government bank shares, Where the money should be invested?

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According to the June quarterly results of Bank of Baroda, there has been a spectacular jump of 79% in its net profit. In the June quarter, all the banks of the Nifty PSU Bank index made a total profit of Rs 15,300 crore, which is about nine and a quarter percent more than a year ago.

 

The days of public sector banks are long gone. Bank Nifty nears record high. On the other hand, the performance of the PSU Bank Index has also been good. The Nifty PSU Bank index has shown a recovery of more than 40 percent from June's low. The PSU banking sector has recently recovered from a period of bad non-performing assets amid volatility in the market and an improving economic outlook. After all, why are PSU bank shares attracting investors?

 

So let's take a look at these reasons first. PSU stocks have seen a jump due to availability at cheap valuations and positive quarterly results. Double-digit growth in the deposit and loan book of banks, the decline in provisioning, and improvement in asset quality are also the main reasons for this.

 

According to the June quarterly results of Bank of Baroda, there has been a spectacular jump of 79% in its net profit. In the June quarter, all the banks of the Nifty PSU Bank index made a total profit of Rs 15,300 crore, which is about nine and a quarter percent more than a year ago.

However, the profits of three out of 12 banks, State Bank of India, Punjab National Bank, and Bank of India declined by 7 to 70 percent. But the reason for the decline in the profits of these banks is being attributed to the mark-to-market loss, given that bond yields have risen in the recent past.