WHICH SECTOR TO INVEST NOWNifty PSU Bank IndexNSE:CNXPSUBANKshanmuraliThe PSU Banking sector (Public Sector Banks) is currently the most highly undervalued sector in the Indian stock market as of mid-April 2026. Why PSU Banks stand out as highly undervalued Current valuations are extremely attractive: The Nifty PSU Bank index trades at a PE of just 8.7. 52.9% below its 10-year median of 18.52. This is the lowest PE among all major NSE sectors. For comparison, the broader Bank Nifty (which includes private banks) is at 15.05 (43.7% below its 10-year median). Other major sectors are trading much higher: IT: ~22.4 (only 9.9% below avg) Auto: ~31.3 (22.3% below avg) Pharma: ~33.7 FMCG: ~35.5 Realty: ~37.2 (highest, though still below its own historical avg) This valuation gap is significant even after the broader market correction earlier in 2026. PSU banks are trading at a deep discount to both their own history and private bank peers. Supporting evidence from recent analysis (April 2026) Multiple analyst reports and screens highlight PSU banks (SBI, Bank of Baroda, Punjab National Bank, Canara Bank, etc.) as deep-value opportunities due to: Strong balance-sheet cleanup (very low NPAs) Robust earnings growth High dividend yields Government capex push benefiting lending to infra/power sectors Energy/PSU energy stocks (e.g., Coal India at PE ~9, NTPC) also appear undervalued and frequently show up in “value picks” lists alongside banks. Infrastructure-related sectors trade at reasonable discounts (~28% below historical), but nothing matches the extreme cheapness of PSU banks. Bottom line: If you are looking for the single most undervalued sector right now, it is PSU Banking. The combination of single-digit PE, strong fundamentals, and structural tailwinds (infra spending, digital banking push, etc.) makes it stand out clearly. Other notable mentions (also cheap but less extreme): Energy/Power (Coal India, NTPC) and select Infra/Capital Goods plays