In nutshell, I found that higher RoE is key (infact in any business). One of the bad argument which I get to understand with bank is they have to maintain certain Capital adequacy ratio. It means that to lend more & more, they need to raise capital (not cash) time to time, even if bank has mega profit, it cannot lend more unless Capital adequacy ratio is not met. Bank can use profit to give dividends, open more branches & venture into other financial business but they just can't lend more. So equity dilution is part of Bank's life.
Higher the dilution rate, better the case. It is very intuitive but Basant jee's mathematical model put it in right perspective.
So let's come back to original theme -> High RoE. A high RoE is subjected more to capable management than of sector/business. One can find excellent RoE companies in old economy sector and bad RoE in new high growth sectors. IBFSL made 173 Cr of profit last Q on capital of 22 *2 Cr , assuming 1:3 debt ratio (which I think very unlikely), RoE comes out to be 135%. One can compare it with other brokers. So one can calculate RoE of SAIL & Hindalco etc.
So all in all, if somebody finds solid management in sunrise sector, we cover almost everything under the sun.
-> solid management make sure high RoE.
-> sunrise sector ensures continued higher demand for diluted capital.
Financials are one sector where high RoE is relatively easier to achieve.
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