Lok Sabha polls: PSU bank stocks plunge by 15-20% amid vote counting

During the intraday trade, the stocks of PSU banks fell sharply. The stocks tumbled by 15-20% following trends of vote counting depicting lower numbers to the NDA than the exit poll predictions.

PSU Bank stocks bleed

During the intraday trade, India's largest PSU lender State Bank of India dropped 15%. Meanwhile Central Bank, Union Bank of India, Canara Bank, Punjab National Bank, Indian Bank and Bank of India all declined by 15-20%

The Economic Times quoted Motilal Oswal that remained overweight on financials and PSU banks. The financial services company also favoured ICICI bank and SBI.

The Economic Times quoted Sanjiv Bhasin, Director of IIFL Securities who expressed bullishness on HDFC, ICICI Axis, and Kotak, highlighting RBL as a potential outperformer. He also noted that private large-cap banks should perform well for the rest of the year, maintaining an overweight stance on these banks.

In the last 5 years, 10 out of 12 PSU bank stocks delivered multibagger returns of up to 473%. As per Ace Equity data, Indian Overseas Bank was the top performer among PSU banks, delivering 473% returns during the Modi 2.0 tenure. Bank of Maharashtra and UCO Bank followed with returns of 325% and 226%, respectively. Central Bank of India, State Bank of India (SBI), Indian Bank, Canara Bank, Punjab & Sind Bank, Union Bank of India, and Bank of Baroda provided returns ranging from 106% to 150% over the last five years.

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