New Delhi, Feb. 12 -- After emerging as top performers in 2025, PSU banking stocks have continued their upward trajectory this year, with investors maintaining a constructive stance on the sector, resulting in a majority of constituents scaling fresh record highs even as the broader market remains volatile.

The rally is underpinned by robust December quarter earnings, supported by an acceleration in system-wide credit growth, margin recovery, and improved asset quality.

While the Union Budget 2027's higher borrowing plan for the next fiscal year triggered panic selling earlier this month, stocks staged a strong comeback. The gauge of PSU banks-the Nifty PSU Bank index-hit another all-time high of 9,294 in today's session (February 12), ...