Indian financial stocks are flashing selective opportunities despite a volatile macro backdrop, with global brokerage Morgan Stanley and domestic major Motilal Oswal Securities (MOSL) highlighting a mix of momentum, value and long-term compounding plays. While Morgan Stanley notes that NBFC stocks have corrected in 2026 after strong outperformance last year, citing higher bond yields and geopolitical risks, it continues to back names such as Shriram Finance, SBI Life and Aditya Birla Capital as top momentum ideas, and sees Bajaj Finance as a structurally strong earnings compounding story, alongside value emerging in housing finance players.
Motilal Oswal, meanwhile, remains constructive on the broader BFSI space despite near-term earnings pressure, pointing out that several financial stocks have delivered strong returns even in a challenging year. The brokerage expects growth to pick up beyond FY26 and has flagged ICICI Bank, HDFC Bank and State Bank of India as its top banking picks, betting on improving earnings momentum after a period of downgrades and margin stress.
Morgan Stanley On India Financials
NBFC stocks correct in 2026 YTD after strong 2025 outperformance
Morgan Stanley Coverage Stocks- Order of Preference
Overweight But With Risks
Turnaround Bets/ Equalwight
Need Execution/ Improvement
Motilal Oswal On Financials
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
