Bank, OMC stocks may be top performers in PSU pack

Only a handful of PSU stocks have beaten Nifty 50 this year

- NIKITA VASHISHT

Once the Street's favourite, shares of public-sector undertakings (PSUs) have not yielded superior returns for investors so far this year. Excluding the recent rally in defence shares, only a handful of PSU stocks have outperformed the benchmark Nifty 50 during the period.

In calendar year 2025 (as of May 14), the Nifty CPSE index has risen 4.14 per cent, in line with the Nifty 50's gain of 4.3 per cent, ACE Equity data shows.

By comparison, the Nifty CPSE index climbed 25.25 per cent in 2024 and 73.7 per cent in 2023, against the benchmark's rally of 8.8 per cent and 20.2 per cent, respectively.

The trend, analysts believe, may not change much in the coming months. And, investors should cherry-pick PSU stocks based on valuation comfort along with earnings growth visibility and policy support.

"The universe of PSU stocks is huge and diverse. Investors should bet on specific sectors and stocks from the basket as most of them may continue to consolidate after years of outperformance," said Kranthi Bathini, director of equities at WealthMills Securities.