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Our latest recommendation is not just another private sector bank. It has a long record of sound lending, clean books, and steady growth. Its risk controls are tight. Its leadership is battle-tested. And the real upside, in our view, lies not just in rising profits but in a long-overdue re-rating.
The numbers have always been strong. The recognition has not.
This bank has grown faster than the banking industry consistently over the last 15 years. Not just that, it is among an elite list of four banks that has maintained gross non-performing assets (think of them as bad loans) below 3.5 per cent in the same period. Only three other private banks in India have managed the same.
Yet the market has never rewarded it with the valuation multiples enjoyed by banks like HDFC or Kotak. The reason is not performance. It is visibility. The bank lacked scale and did not have a pan-India presence. It stayed out of the spotlight.
That is exactly what makes the current setup so powerful.
The bank is no longer playing small
A new CEO is now leading the charge. He brings experience that matters.
He was a key part of the leadership team that turned a non-banking finance company into one of India’s largest private banks. That transformation was built on clear execution, bold expansion, and a focus on profitability.
He is now building the same story here.
The bank plans to rank among the top five Indian banks by 2030. For that, it is expanding into new regions and shifting towards higher-yielding loan products. In addition, it is entering microfinance, wealth management, insurance distribution, and investment banking. A full-service universal bank is the clear goal.
This is how re-ratings happen
Even if you ignore the multiple expansion, the earnings outlook is strong. Net profit is projected to triple over the next five years. Margins are expected to rise. Asset quality remains stable. And fee income is climbing steadily.
But the real story is valuation.
The stock trades at a much lower premium compared to most full-service banks in India. If this bank delivers on its plan, the gap will close. That shift alone could unlock significant gains.
This is the kind of setup where investors look back and wonder how they missed it.
We shared this stock with subscribers on May 30
You still have time to act. But once the market sees what we see, the window will close.
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