Motilal Oswal has recommended several banking stocks as key picks for investors this festive season. These selections are based on strong quarterly performance, improving asset quality, and growth prospects, offering attractive upside potential. The brokerage sees as much as 28% upside potential among these stocks .
Let’s take a look at the brokerage call on these stocks –
Motilal Oswal on DCB Bank
Motilal Oswal maintains a ‘Buy’ rating on DCB Bank with a target price of Rs 165, implying an upside of 28%. As per the brokerage report, the bank “reported a steady quarter with a beat in earnings amid lower provisions, healthy net interest income, and controlled operating expenses.”
Margins improved by 3 basis points sequentially, and the bank expects further improvement if there are no additional rate cuts. The brokerage adds that “asset quality improved with slippages moderating sequentially, and management expects credit cost to remain below 45 basis points for the full year.”
For FY27, Motilal Oswal projects a RoA of 1.01% and RoE of 15.3%.
Motilal Oswal on ICICI Bank
ICICI Bank continues to be a preferred pick with a ‘Buy’ rating and a target price of Rs 1,700, suggesting an upside of 18%. According to the brokerage, ICICI “reported another commendable quarter, wherein the bank saw healthy NIMs, lower provisions, controlled slippages and contained operating expenses.”
Its focus on better-yielding assets has helped maintain net interest margins, while investments in technology have resulted in “consistent productivity gains, along with market share gains and steady improvement in cost ratios.” For FY27, the brokerage expects a RoA of 2.3% and RoE of 17.0%.
Motilal Oswal on Federal Bank
Motilal Oswal reiterates a ‘Buy’ rating on Federal Bank with a target price of Rs 250, implying an upside of 18%. The brokerage notes that “the bank reported a healthy quarter due to better-than-expected NIMs, driven by a sharper reduction in cost of funds, an improving CASA mix, and a product mix shift towards mid-yielding assets.”
Asset quality improved as slippages in agriculture and retail declined, while the brokerage has increased its earnings estimate by 5–5.5% for FY26/27. Federal Bank is expected to deliver a RoA of 1.19% and RoE of 12.8% in FY27.
Motilal Oswal on HDFC Bank
HDFC Bank “posted a steady quarter with an earnings beat, aided by healthy NII and robust treasury gains,” says the brokerage.
For FY27, Motilal Oswal projects a RoA of 1.84% and RoE of 14.3%, maintaining a ‘Buy’ rating with a target price of Rs 1,175 (upside potential of 17%). Loan growth is picking up, CD ratio is expected to moderate below 90%, and slippages have moderated. The bank’s contingency and floating provisions total Rs 381 billion, supporting future return ratios.
Motilal Oswal on RBL Bank
The brokerage maintains a ‘Buy’ rating with a target price of Rs 350 (around 17% upside).
RBL Bank reported a slight earnings miss due to higher provisions, though margins expanded slightly. The brokerage notes, “Emirates will invest USD3 billion for a 60% stake in RBK, triggering an open offer to acquire up to 26%. This will enable RBK to scale up its operations and expand into cross-border and NR business.
” Earnings estimates for FY27/28 have been raised by 19%/17%, with projected RoA of 1.2% / 1.4%,” added the brokerage report.