Goldman Sachs Favors Six Indian Banks Amid Robust Loan Growth

Goldman Sachs has initiated coverage on several Indian banks and remains bullish on six private lenders. The Wall Street major expects loan growth to remain robust at around 14-15% during FY26-FY29, representing a moderation from the current elevated run-rate of 18% YoY as of June 2026.

The firm named ICICI Bank, Kotak Mahindra Bank, HDFC Bank, Axis Bank, Federal Bank, and AU Small Finance Bank as its top banking picks. It initiated coverage on these stocks with 'Buy' calls and target prices ranging from Rs 402 to Rs 1,935 per share.

Goldman Sachs noted that asset-quality challenges are largely behind for most of the banks, and they have protected net interest margins (NIMs) much better than peers. The firm expects loan growth to re-accelerate and cost-to-income improvement driven by operating leverage will lead to strong earnings recovery over the medium term.