An Overview of the Indian Banking Sector in 2025
For investors keen on diversifying their stock portfolios, sectoral diversification can be highly effective. If you plan to implement this strategy, you can consider the best bank shares to buy to reduce your portfolio risk. The best bank stocks can be fine additions to your holdings because of the sector’s importance in the Indian economy. The sector contributes to financial stability, liquidity and inclusion.
By knowing what the best banking stocks in India are, you can invest in them through a trusted broking partner like Samco Securities. Since most of the top 10 bank stocks in India have a history of relatively stable growth, they can reduce the overall risk in your stock portfolio. In this article, we delve into some crucial data-driven recommendations backed by Samco’s analytical team.
Why Invest in Bank Stocks in India?
There are various reasons to consider investing in the best banking stocks in India. They include:
Economic Growth Engine
The best bank stocks in India are direct beneficiaries of the country’s 7%+ GDP growth. As one of the fastest-growing economies in the world, India’s banking sector shows phenomenal growth potential. The top 10 bank stocks in India have consistently demonstrated strong business growth, making them attractive for investors keen on participating in India's growth.
Digital Banking Revolution
When considering which bank share is the best to buy, you need to also focus on digital leadership. The best banking stocks in India are from companies that are investing heavily in technology, from UPI to AI-driven services. These investments can cut operational costs significantly and directly improve profitability, making them the best bank shares to buy.
Sectoral Resilience
Among Indian equities, the answer to which bank share is the best to buy often depends on stability metrics. The best bank stocks have demonstrated remarkable resilience through economic cycles. With improved risk management, strong capital buffers and diversified revenue streams, the best banking stocks in India come with stability and growth potential.
Dividend Consistency
The best banking stocks in India also offer attractive dividends and carry high dividend yields. With improving profitability and strong capital adequacy ratios, the best bank stocks have sustainable and often growing dividend payouts. If you are an income-focused investor, the best banking stocks in India provide steady returns alongside potential capital appreciation.
Regulatory Support
The banking sector also enjoys strong government support and has the backing of the RBI. Recent policies supporting digital payments, improving NPA resolution and enhancing capital frameworks have strengthened the best bank stocks. This regulatory environment makes the best banking stocks in India particularly resilient during market volatility.
Criteria for Selecting the Best Bank Stocks in India 2025
Not sure about which bank share is the best to buy? Check out the main criteria you need to consider to identify the best bank stocks for your portfolio.
Market Capitalisation
The best bank stocks in India tend to lead in market capitalisation. When determining which bank share is the best to buy, market cap is an important metric as it can indicate market leadership and trading liquidity. Among the top 10 bank stocks in India, larger market caps can also suggest stronger institutional backing and higher market acceptance.
NPA (Non-Performing Assets) Ratio
The best banking stocks in India maintain low NPA ratios. While analysing which bank share is the best to buy, this critical metric can reveal asset quality and the efficiency of risk management. Top bank stocks with lower NPAs may demonstrate superior credit assessment procedures, leading to stronger balance sheets.
Loan Growth
When you are selecting the best bank share to buy, look for consistent loan growth. This metric can be crucial. The best banking stocks in India typically show high annual loan growth rates while simultaneously maintaining quality. These best bank stocks also balance their expansion across retail, corporate and SME segments, so the business growth is sustainable.
Return on Assets (ROA)
Among the best banking stocks in India, high ROA values generally indicate efficient utilisation of assets. Many of the top 10 bank stocks in India consistently deliver superior ROA through operational excellence. The solution to which bank share is the best to buy often correlates with improving ROA trends, so that’s another factor to look for.
Net Interest Margin (NIM)
The net interest margin represents the difference between interest paid and interest earned. The best bank stocks tend to maintain healthy NIMs, since the higher this figure is, the better. This crucial profitability metric helps you identify which bank share is the best to buy as stocks with stable or expanding NIMs demonstrate pricing power.
12 Best Bank Stocks to Buy in India 2025
The Indian banking sector comprises both private and public sector entities, each with its own unique strengths and growth prospects. Here is a table showcasing the best banking stocks in India you can consider investing in.
Sr no. | Company name | CMP as of 14 February 2025 | Market Cap, 14 February 2025 | P/B, 14 February 2025 | BSE Scrip Code | NSE Symbol | Ratings | Industry |
1 | 534.85 | 39813.70 | 2.42 | 540611 | AUBANK | 5 | Bank - Private | |
2 | 996.75 | 308595.13 | 1.80 | 532215 | AXISBANK | 4 | Bank - Private | |
3 | 135.35 | 21804.50 | 0.91 | 541153 | BANDHANBNK | 5 | Bank - Private | |
4 | 205.10 | 106064.64 | 0.81 | 532134 | BANKBARODA | 1 | Bank - Public | |
5 | 1695.00 | 1296792.31 | 2.70 | 500180 | HDFCBANK | 5 | Bank - Private | |
6 | 1258.45 | 889381.22 | 3.33 | 532174 | ICICIBANK | 5 | Bank - Private | |
7 | 60.57 | 44344.61 | 1.18 | 539437 | IDFCFIRSTB | 2 | Bank - Private | |
8 | 1024.25 | 79794.55 | 1.20 | 532187 | INDUSINDBK | 4 | Bank - Private | |
9 | 1952.10 | 388114.60 | 3.41 | 500247 | KOTAKBANK | 5 | Bank - Private | |
10 | 92.25 | 106022.40 | 0.90 | 532461 | PNB | 1 | Bank - Public | |
11 | 722.00 | 644357.57 | 1.58 | 500112 | SBIN | 3 | Bank - Public | |
12 | 180.95 | 44429.85 | 1.37 | 500469 | FEDERALBNK | 4 | Bank - Private |
Top 3 Private Bank Stocks to Buy in India 2025
Private sector banks play a crucial role in the growth of the country’s economy. These entities are known for innovation, technology adoption, and customer-centric services. Some of the best bank stocks from the private sector have consistently shown to be resilient during market cycles and economic downturns, making them good long-term investment prospects. The following three private bank stocks are among the best out of the top 10 bank stocks in India.
HDFC Bank Limited
HDFC Bank Limited is one of the best banking stocks in India. Known for high asset quality, consistent performance, and a strong mix of retail and corporate lending portfolios, it is the best bank share to buy for the long term.
HDFC bank’s Gross Non-Performing Assets (GNPA) and Net Non-Performing Assets (NNPA) are 1.24% and 0.33% respectively, which is the lowest among the top 10 bank stocks in India. The bank has also seen a robust year-on-year growth of 4% in the Q3 PAT and a growth of 3% in deposits and 1% in advances between Q4FY24 and Q2FY25.
ICICI Bank Limited
ICICI Bank Limited features consistently among the best bank stocks in India. The bank’s diversified offerings across retail, corporate, and investment banking sub-segments are a major reason for its featuring among the best banking stocks in India.
ICICI Bank has the highest return on equity (ROE) of 19.47% and the second-highest return on assets (ROA) of 2.08% among the top 10 bank stocks in the country. The bank’s healthy Net Interest Margin (NIM) of 3.79% and low NNPA of 0.45% are other financial metrics that work in its favour.
Axis Bank Limited
Axis Bank Limited is the third-largest private sector bank and one of the top 10 bank stocks in the country. Its extensive reach and diverse range of financial products make it the best bank stock for the long term.
Axis Bank’s ROE is 18.51% and its ROA is 1.78%, which puts it on par with the other two top private sector banks. Another noteworthy metric is its NNPA of 0.34%, which is the one of the lowest among the best banking stocks in India.
Top 3 Public Sector Bank Stocks to Buy in 2025
Public sector banking institutions are instrumental in the proper functioning of India’s financial ecosystem. These entities provide essential banking services to the vast majority of the country’s population,including underserved rural areas. Among the top 10 bank stocks in India, the following three public sector institutions have consistently been ranked highly.
State Bank of India
The State Bank of India (SBI) is the largest public sector bank and is one of the top 10 bank stocks. Renowned for its extensive network of branches across urban and rural areas, SBI’s focus is primarily on the retail segment.
With the ROE at 18.97% and the price-to-book (P/B) ratio at 1.58 (as on February 14, 2025), the fundamentals appear quite strong, making SBI one of the best bank shares to buy in the public sector space. For a bank of this size, a GNPA of 2.24% and an NNPA of just 0.57% are also noteworthy.
Bank of Baroda
Bank of Baroda (BOB) is among the best bank stocks in the public sector space, especially after its recent mergers with other peers. The bank has improved operational efficiency and widened its customer base, making it one of the best banking stocks in India.
Bank of Baroda has a strong ROE of 16.38% and a low NNPA of just 0.68%, which are quite favourable. The P/B ratio as on February 14, 2025, is 0.81, making it one of the top 10 bank stocks to be correctly valued by the market.
Punjab National Bank
Punjab National Bank (PNB) is one of the key entities in the best bank share to buy list. The bank is actively working on enhancing digital services, reducing NPAs, and increasing profitability.
The massive growth in the Q3 PAT (year-over-year) figure, which has increased by about 106%, makes PNB one of the best bank stocks for the short term. Another noteworthy metric is the P/B ratio of 0.90, which places the entity among the top 10 bank stocks in India in terms of valuation.
A Comparative Analysis of the Listed Bank Stocks in India 2025
When you compare the best bank stocks, you need to understand how to effectively analyse key metrics. Market capitalisations, for instance, give you a broad overview of market presence. You can also compare ROA and ROCE numbers to determine which bank share is the best to buy. Higher ROA and ROCE often correlate with better management quality and operational efficiency.
Dividend yields are another crucial comparison point among the top 10 bank stocks in India. To find which bank share is the best to buy, you should also consider dividend yields alongside growth metrics. While higher yields are great for investors seeking additional income, lower yields might be acceptable if the bank reinvests heavily in digital transformation or branch expansion.
The table below offers you detailed insights into how the best banking stocks in India compare against one another.
Sr.No. | Accord Code | Company Name | Industry | Market Cap, 14 February 2025 | P/B, 14 February 2025 | ROE (%) | ROA (%) | NIM (%) | GNPA (%) | NNPA (%) | PAT as on Q3FY25 | PAT as on Q3FY24 | YoY Growth | Deposits as on Q2FY25 | Deposits as on Q4FY24 | Deposits Growth | Advances as on Q2FY25 | Advances as on Q4FY24 | Advances Growth | BSE Scrip Code | NSE Symbol |
1 | 286335 | Bank - Private | 39813.70 | 2.42 | 13.10 | 1.54 | 4.83 | 1.67 | 0.55 | 528.45 | 375.25 | 41% | 109693.15 | 87182.12 | 26% | 94838.18 | 73162.66 | 30% | 540611 | AUBANK | |
2 | 132215 | Bank - Private | 308595.13 | 1.80 | 18.51 | 1.85 | 3.55 | 1.47 | 0.34 | 6763.10 | 6493.36 | 4% | 1094349.54 | 1084698.91 | 1% | 1054420.29 | 1038601.67 | 2% | 532215 | AXISBANK | |
3 | 279527 | Bank - Private | 21804.50 | 0.91 | 10.84 | 1.34 | 6.20 | 3.84 | 1.11 | 426.49 | 732.72 | -42% | 142509.54 | 135201.99 | 5% | 126055.71 | 121136.78 | 4% | 541153 | BANDHANBNK | |
4 | 132134 | Bank - Public | 106064.64 | 0.81 | 16.38 | 1.16 | 3.04 | 2.92 | 0.68 | 5116.82 | 4748.32 | 8% | 1415371.47 | 1389614.57 | 2% | 1177307.48 | 1146424.22 | 3% | 532134 | BANKBARODA | |
5 | 100180 | Bank - Private | 1296792.31 | 2.70 | 17.64 | 2.00 | 3.41 | 1.24 | 0.33 | 18340.11 | 17718.00 | 4% | 2560580.34 | 2496324.92 | 3% | 2620474.61 | 2585710.03 | 1% | 500180 | HDFCBANK | |
6 | 132174 | Bank - Private | 889381.22 | 3.33 | 19.47 | 2.08 | 3.79 | 2.26 | 0.45 | 13828.61 | 11255.19 | 23% | 1551165.62 | 1529513.61 | 1% | 1397265.27 | 1360046.48 | 3% | 532174 | ICICIBANK | |
7 | 278580 | Bank - Private | 44344.61 | 1.18 | 10.14 | 1.10 | 5.84 | 1.88 | 0.60 | 340.17 | 732.09 | -54% | 236827.39 | 223558.15 | 6% | 223103.93 | 215061.31 | 4% | 539437 | IDFCFIRSTB | |
8 | 132187 | Bank - Private | 79794.55 | 1.20 | 15.28 | 1.85 | 4.24 | 1.92 | 0.57 | 1402.35 | 2301.42 | -39% | 412396.82 | 384585.67 | 7% | 357158.63 | 343298.27 | 4% | 532187 | INDUSINDBK | |
9 | 100247 | Bank - Private | 388114.60 | 3.41 | 14.88 | 2.59 | 4.54 | 1.39 | 0.34 | 4639.63 | 4202.39 | 10% | 457591.04 | 445268.76 | 3% | 458464.74 | 430351.58 | 7% | 500247 | KOTAKBANK | |
10 | 132461 | Bank - Public | 106022.40 | 0.90 | 8.48 | 0.54 | 2.67 | 5.73 | 0.73 | 4648.60 | 2252.67 | 106% | 1540166.82 | 1468416.40 | 5% | 1078206.83 | 1027870.15 | 5% | 532461 | PNB | |
11 | 100112 | Bank - Public | 644357.57 | 1.58 | 18.97 | 1.07 | 2.88 | 2.24 | 0.57 | 19175.35 | 11282.66 | 70% | 5282740.55 | 5171743.14 | 2% | 4089155.52 | 3943993.51 | 4% | 500112 | SBIN | |
12 | 100469 | Bank - Private | 44429.85 | 1.37 | 15.04 | 1.34 | 3.04 | 2.13 | 0.60 | 948.70 | 1063.24 | -11% | 269064.42 | 252455.02 | 7% | 240131.54 | 218110.28 | 10% | 500469 | FEDERALBNK |
Factors to Watch For in the Banking Sector in 2025
Before identifying which bank share is the best to buy and investing in the top 10 bank stocks in India, you must be aware of the key factors to consider in your decisions. They include:
Industry-Specific Risks
When evaluating which bank share is the best to buy, you must monitor the risks involved. The best banking stocks in India face challenges from regulatory changes, especially with regard to capital requirements and lending norms. Interest rate volatility also directly impacts the top 10 bank stocks in India and affects their net interest margins.
Growth Opportunities
The top bank stocks in India are investing heavily in modern technology like mobile banking and AI-driven services to reduce costs and expand their reach. The best bank stock investments should help you capitalise on this kind of digital transformation. When considering which bank share is the best to buy, look for institutions leading the digital revolution.
The Impact of Economic Reforms
The top 10 bank stocks in India benefit significantly from government reforms like IBC and financial inclusion initiatives. The best bank stocks show superior growth when they leverage policy support for rural expansion and SME lending. To select the best bank stock, it is crucial to understand how different reforms benefit different banks.
How to Invest in Banking Stocks with Samco
To invest in the best banking stocks in India via Samco, you just need to follow the steps outlined below:
- Step 1: Open the Samco Trading App on your smartphone and log into your account.
- Step 2: Search for the name of the best bank share to buy based on your research.
- Step 3: Select the ‘Buy’ option.
- Step 4: In the order screen, submit the details of the price and the number of shares you want to purchase.
- Step 5: Then, click ‘Quick Trade’ to place your order immediately.
If your order is successful, the trade will be executed and you can find the best bank stocks that you purchased in the ‘Holdings’ section of the Samco Trading App.
Model Portfolio of the Best Bank Stocks in India
If you wish to gain exposure to some of the best banking stocks in India, here is a model portfolio you can emulate. As of February 14, 2025, you would have needed a total capital of Rs. 25,735.55 to invest in this portfolio.
Company Name | Weightage | CMP, 14 February 2025 | Quantity | Total (Rs.) |
0.26 | 1695.00 | 4 | 6,780.00 | |
0.13 | 1952.10 | 2 | 3,904.20 | |
0.38 | 1258.45 | 8 | 10,067.60 | |
0.22 | 996.75 | 5 | 4,983.75 | |
25,735.55 |
Ready to start investing in the best bank stocks? Open your Samco trading account today and access comprehensive research reports and expert insights. Samco Securities offers cutting-edge tools to help you invest in the best banking stocks in India. With competitive brokerage rates and dedicated customer support, investing in the top 10 bank stocks in India has never been easier.
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