India’s largest bank SBI share price soars 1.6% to Rs 583.7 per share as State Bank of India reported an 89.4% surge in its consolidated net profit for the quarter ended March 2023. The bank’s consolidated net profit clocked in at Rs 18,094 crore, while its income from interest rose 31.4% in the same period.
SBI Q4FY23 earnings
State Bank of India posted its highest-ever fiscal fourth quarter standalone profit at Rs 18,343.25 crore, up 83.5% in comparison to Rs 9,993.76 crore in the same quarter last year, beating estimates. It posted a total income of Rs 1,36,852.39 crore during the fourth quarter, up 26.7% from Rs 1,08,034.68 crore in the fourth quarter of FY22. This was led by healthy loan growth (+17% YoY), better fees and lower credit costs, having front-loaded its provisions during 9MFY23 on a prudent basis.
“State Bank of India – the largest PSU bank – reported a stellar performance across all parameters, showing that it is truly a giant in the room. The bank exceeded market expectations with a wide margin across all the key parameters, indicating that it truly deserves to be the leader in the banking sector. The top line was mainly contributed by retail banking operations which uplifted NIMs. SBI has shown its strength in the last few quarters both on core operating performance and asset quality. The bank’s provisioning almost halved in Q4FY23 in comparison to Q4FY22,” said Shreyansh Shah, Research Analyst, Stoxbox.
Stock call: SBI
“We tweak our FY24E/FY25E estimates to factor in stronger loan growth and lower credit costs, partly offset by higher opex; maintain BUY with a revised SOTP-based target price of Rs 732,” said HDFC Securities.
“Uncertain macros notwithstanding, SBIN has delivered strong performance, led by steady business and revenue growth. We believe SBIN will be a strong play on recovery. We expect ~15% ROE by FY25E and assign 1.2x December 2024E P/BV, leading to a core bank value of INR 510. We ascribe a subsidiary value of INR 206, leading to a SOTP-based TP of INR 717. We reiterate Buy. SBIN is our preferred stock in the PSU basket. Macroeconomic uncertainty is the biggest risk, given its market size and exposure,” Elara Global Research said.