PSU banks expected to outperform private peers in Q2 profit growth

Public Sector Banks are estimated to report a 27% annual growth in profit after tax for Q2 FY2027, outperforming private banks which are estimated to see a 24% annual growth.

Motilal Oswal Financial Services projects private bank net interest income to grow 13% annually compared to 10.8% for public sector lenders, driven by strong FCNR (B) deposit inflows.

Motilal Oswal's top banking sector picks include ICICI Bank, State Bank of India, Kotak Mahindra Bank and AU Bank.