Best Banking Stocks in October 2025: Indian Bank, SBI, Canara Bank & More on 5Y CAGR Basis

The banking sector remains a vital pillar of India’s economy, offering investors both stability and long-term growth opportunities. According to RBI’s Scheduled Banks’ Statement, deposits across all scheduled banks surged by ₹2.04 lakh crore in FY24. In this article, find the best banking stocks in October 2025, based on 5yr CAGR.

Best Banking Stocks in October 2025 – 5yr CAGR Basis

Note: The best banking stocks in October 2025 listed here are as of September 24, 2025. The stocks are picked from Nifty 500 universe and positive 1-yr returns. They are sorted by 5yr CAGR.

Overview of Best Banking Stocks in October 2025

1. Indian Bank 

Indian Bank, established in 1907, is a medium-sized bank that provides deposits, loans, and various services. The bank reported a performance in Q1FY26, with net profit rising 23.69% YoY to ₹2,973 crore in June 2025, compared to ₹2,403 crore in June 2024. The bank’s net interest income (NII) also registered a growth of 2.93% YoY, increasing to ₹6,359 crore in June 2025 from ₹6,178 crore in June 2024.

• ROE: 17.09%
• ROCE: 10.53%

2. Karur Vysya Bank Ltd

Karur Vysya Bank offers a diverse range of banking and financial services, with operations spanning commercial banking and treasury management. The bank’s net profit for the quarter rose by 13.51%, reaching ₹521 crore compared to ₹459 crore in the same quarter last year. As of June 30, 2025, total deposits crossed the ₹1 lakh crore milestone, standing at ₹1,06,650 crore, reflecting a 15.49% Y-o-Y increase, up by ₹14,301 crore from ₹92,349 crore as of June 30, 2024.

Key Metrics: 

• ROE: 17.68%
• ROCE: 14.84%

3. Canara Bank Ltd

Canara Bank, established in 1906 and nationalised in 1969 alongside 13 other major commercial banks by the Government of India, is headquartered in Bangalore. The bank reported a global deposit of ₹14,67,655 crore, marking a growth of 9.92% year-on-year. The bank’s net profit stood at ₹4,752 crore, reflecting an increase of 21.69% compared to the previous period.

• ROE: 17.56%
• ROCE: 8.40%

4. Bank of Baroda Ltd

Bank of Baroda offers a wide range of services, including personal banking, corporate banking, international banking, SME banking, rural banking, NRI services, and treasury operations. In Q1 FY26, the bank reported a total interest income of ₹31,091 crore, up 4.9% year-on-year from ₹29,629 crore in Q1 FY25. Its operating profit rose to ₹8,236 crore, marking a 15% increase compared to ₹7,161 crore in the same quarter last year.

• ROE: 15.43%
• ROCE: 7.47%

5. Union Bank of India Ltd 

Union Bank of India is engaged in offering a broad spectrum of services, including banking operations, government business, merchant banking, agency services, insurance, mutual funds, and wealth management, among others. The bank’s net profit rose by 11.87% year-on-year in Q1FY26, while its interest income recorded a YoY growth of 3.53% during the same period.

• ROE: 17.05%
• ROCE: 11.59%

Also Read: Best Pharma Stocks in October 2025! 

Conclusion

The banking sector remains a vital component of India’s financial system, driven by increasing credit demand and technological advancements. However, performance can be impacted by factors such as interest rate fluctuations, regulatory changes, and asset quality trends. Investors should assess individual banks based on financial strength, profitability, and risk management before making investment choices.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.