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Private banks at 10-year lows on price-to-book valuations; Jitendra Sriram sees opportunity - Edited byAjay Vaishnav - Published OnOct 30, 2026 | 17:07 IST - Last Updated OnOct 30, 2026 | 17:07 IST Jitendra Sriram says foreign investor positioning and continued outflows are weighing on private sector banks despite healthy operating metrics. He also sees improving traction in CDMOs and fluorochemicals, while technology stocks face mixed signals and Reliance Industries awaits a market re-rating. Private sector banks could offer an investment opportunity despite their continued underperformance, with valuations at 10-year lows on a price-to-book basis and no major concerns emerging from their operating performance, Jitendra Sriram, Senior Fund Manager at Baroda BNP Paribas Mutual Fund, said in an interview with CNBC-TV18. Sriram said key indicators, including net interest income (NII) growth, asset quality and net interest margins (NIMs), showed no significant signs of weakness in the sector. He attributed the poor performance of banking stocks partly to foreign investor ownership and continued outflows rather than underlying business fundamentals. “From that perspective, I would definitely be positively inclined,” Sriram said, referring to bank valuations. He added that the sector might remain under pressure until foreign investor outflows ease, but believes the current weakness could present an opportunity. “At some point, the tide will turn,” he said. CDMO and fluorochemicals show stronger traction Recent results point to improving prospects for parts of the chemicals sector, particularly contract development and manufacturing organisations (CDMOs) and fluorochemicals, according to Sriram. He said results from several companies indicated that businesses participating in the CDMO opportunity were seeing stronger traction. “I think they broadly indicate that some of the players participating in the CDMO opportunity are actually seeing a lot more traction,” he said. Crop chemicals, however, have been relatively subdued. Sriram attributed the weakness to El Niño and anaemic demand, which have weighed on the segment. Technology stocks send mixed signals Sriram said technology and banking were the two major sectors the fund manager had been assessing. While the fund was underweight on technology stocks in the early part of the year, its position has since moved closer to neutral. Recent results from global technology companies have offered contrasting signals. Sriram cited Cognizant's guidance cut and Capgemini's guidance increase as examples of the divergence in their outlooks. Reliance Industries yet to benefit from Jio Platforms' listing Reliance Industries has not received the expected boost from the strong listing of Jio Platforms, its parent company's shares continuing to languish below ₹1,200, Sriram said. He said the valuation implications of Jio Platforms' listing should, in principle, have supported Reliance Industries' shares, but the positive effect had yet to materialise. On the refining business, Sriram pointed to the absence of certain tax breaks and unusually high profits that had benefited the company in the previous year. He also cited Singapore gross refining margins (GRMs), US discussions with Russia on diesel procurement, and the potential benefit to Reliance Industries' special economic zone (SEZ) refinery from elevated diesel crack margins. The crack-margin figures being reported across various media platforms appeared to indicate a strong tailwind for the business, Sriram said, making the lack of a corresponding market response surprising. Watch accompanying video for full conversation. Disclosure: Reliance Industries Ltd, which owns Jio, is the sole beneficiary of Independent Media Trust that controls Network18, the parent company of CNBCTV18.com.
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