I completely agree with above post. I think this sector has limited competition from few good players (read HDFC, ICICI, Axis, Yes Bank etc) so they made money on the back of bad service provided by PSU banks. But current structural changes ushered in by RBI by giving license of payment banks, new licence to Bandhan and IDFC with a promise of future “license on tap” will make competition severe in this sector.
As with any sector, competitive intensity gives great benefit to the end customer but dents profitability of the companies in the sector, till consolidation takes place. Telecom sector is very good example of that for last 5-10 years. Due to above reasons, it may be better to avoid this sector for next 2-3 years, till the dust settles and clarity emerges in terms of survivors.
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