Marketsmith’s Joshi favors Karur Vysya Bank over RBL Bank

what happened

CNBC-TV18 reports that Marketsmith India Research Director Mayuresh Joshi prefers South Indian private-sector lenders, including Karur Vysya Bank, to RBL Bank. He said Karur Vysya has delivered more consistent earnings and that its agricultural loan book is adequately covered rather than entirely unsecured, helping contain asset-quality concerns. RBL Bank posted a respectable quarter, but its management is expected to stay guarded for the next couple of quarters before adopting a more aggressive stance in 2027 and 2028.

Bandhan Bank remains a clear laggard after falling from ₹210 to the ₹150–₹160 range, close to its 52-week low. “I think there has to be some element of clarity in all the issues surrounding the bank itself,” Joshi said. Checks with participants in the micro, small and medium enterprises (MSME) and microfinance segments point to possible difficulties over the next couple of quarters. The sector faces three key pressures: higher rates that may increase stress in restructured books, payout risks in unsecured lending and recent insurance-commission changes that could hurt lower-ranked non-banking financial companies (NBFCs).

Joshi expects large, well-led NBFCs to withstand the cycle, while mid-sized and microfinance firms face a more difficult backdrop. In technology, HCLTech kept its cost-and-currency guidance at 2.5% and retained an EBITDA margin range of 17.5% to 18.5%. It also announced a record order book and rapid progress in advanced artificial intelligence (AI). Still, global conditions, concern about an AI deflation trade and lower worldwide spending present risks. Referring to Satya Nadella’s recent call for a “human emergency break” in the AI ecosystem, Joshi said the wider global backdrop may not favor large-cap technology companies.

why it matters

For banks and NBFCs, markets will focus on how higher rates affect restructured and unsecured portfolios, as well as the contrast between large and smaller lenders. Technology stocks also face uncertainty from global spending and the AI debate.

instruments