J.P.Morgan recommends going long Federal Bank but shorting HDFC Bank.
Says recent deviations in the two stocks is unjustified given the lack of fundamental reasons for the move.
"We find in this particular instance there is no specific reason for the deviation and we therefore expect this divergence to correct itself," J.P.Morgan says.
HDFC Bank has risen 4% in April while Federal Bank fell 4% in the same period.