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Our Bureau

`Investors are now getting more aware of the sector's potential'

Kolkata , Sept. 26

Sustained buying on Tuesday drove the heavyweight State Bank of India stock to cross the Rs 1,000-mark, a gain of nearly 3 per cent. It closed at Rs 998.75 on the NSE, clocking a total traded quantity of 15.4 lakh shares.

Market circles have attributed the move to momentum buying in almost all frontline stocks as well as specifically to SBI's premier position in a sector that is now widely expected to gain. The country's No 1 bank, which ended last quarter with decent numbers, is seen to be riding the growth trend that is likely to set in.

SBI, a key component of the top indices, opened higher at Rs 973.85 and reached the day's high at Rs 1,001 after touching a low of Rs 968.55. The change is a straight Rs 28 or 2.89 per cent. On Tuesday, the Nifty moved up by 1.4 per cent.

Broking outfit Sharekhan points out that heavyweights have spurred the market, thanks to a renewed bout of buying in banking, auto and consumer durable stocks. As for banks, both SBI and ICICI Bank gained today, the latter scaling up by 2.7 per cent to Rs 678.

Investors are now getting more aware of the banking sector's potential, observed Mr Anup Maheshwari, Head - Equities, DSP Merrill Lynch MF, adding that some sections may be willing to step up their allocations to the sector.

SBI's strong quarterly performance can only help the buying trend, it is also felt. Its Q1 working results (excluding one-time items) saw a 20-per cent growth in net profit on a QoQ basis. Its gross and net NPAs declined from 5.67 per cent and 2.44 per cent as on June 30, 2005, to 3.88 per cent and 1.69 per cent respectively for the quarter ended June 30, 2006.

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SBI hits Rs 1,000-mark on sustained buying

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