Banking, Financial Services and Insurance (BFSI) stocks are in focus today after the RBI revised priority sector lending (PSL) guidelines which will take effect from April 1, 2025. It has resulted in increased loan limits, including housing loans for enhanced PSL coverage.

Market experts believe the development is positive for lending companies in the short-to-medium term. Domestic brokerage Motilal Oswal says that the scope of PSL is poised to foster greater financial inclusion.

“The revised guidelines are a significant step forward, designed to help banks more effectively manage their PSL portfolios — an area where many institutions previously struggled to keep pace,” Motilal report read.

Although Motilal believes these measures are incrementally positive for the sector as a whole, banks like HDFC Bank, ICICI Bank, State Bank of India (SBI) and Axis Bank would be the largest beneficiaries, it said.

In addition, RBI has also broadened the purposes based on which loans may be classified under “renewable energy.”

As per the guidelines, bank loans up to ₹35 crore to borrowers for renewable energy-based power generators and for renewable energy-based public utilities will be eligible for priority sector lending. For individual households, the limit for renewable energy will be ₹10 lakh per borrower. Brokerages acknowledged that this would aid the push for cleaner energy solutions. SBI Securities sees this positive for Indian Renewable Energy Development Agency (IREDA) in the short to medium term.

IREDA shares surged 4 per cent to ₹176.77 on the NSE before trading flat at ₹171.10 as at 12.18 pm on Tuesday. The company’s board will consider fund raising at its meeting today, according to stock exchange disclosure.

According to Reuters, global brokerages Citi and Jefferies called HDFC Bank as a beneficiary of the revised guidelines. Trading among top gainers of Nifty 50 components, HDFC Bank shares rose 2.18 per cent to trade at ₹1,839.30 as at 12.18 pm, after hitting an intraday high of ₹1,843.70.