SBI Card in demand after decent Q1 numbers

SBI Cards and Payment Services jumped 5.03% to Rs 789.60 on BSE after the companys net profit rose 14% to Rs 393.29 crore in Q1 June 2020 compared with Rs 345.59 crore in Q1 June 2019.

Jul 21, 2020 09:07 IST capital market

Total income stood at Rs 2,195.60 crore in Q1 June 2020, sliding 4.72% from Rs 2,304.27 crore in Q1 June 2019. Interest income increased 34.6% to Rs 1,412 crore in Q1 June 2020 from Rs 1,049 crore in Q1 June 2019. Income from fees and services declined 27% to Rs 668 crore in Q1 June 2020 from Rs 916 crore in Q1 June 2019. Other income tumbled 81% year-on-year to Rs 43 crore in Q1 June 2020.

Profit before tax (PBT) declined 0.80% to Rs 528.27 crore in Q1 June 2020 from Rs 532.54 crore in Q1 June 2019. Total tax expense fell 27.80% to Rs 134.97 crore in Q1 June 2020 as against Rs 186.94 crore in Q1 June 2019.

Net profit was aided by reduction in operating costs and finance costs. Total operating costs decreased 15.4% to Rs 907 crore in Q1 June 2020 from Rs 1073 crore in Q1 June 2019. Finance costs stood at Rs 275 crore in Q1 June 2020, falling 9% from year ago period. Impairment losses & bad debts expenses for the quarter rose 22.17% to Rs 485 crore compared with Rs 397 crore for Q1 June 2019.

The companys gross advances (credit card receivables) as of 30 June 2020 were Rs 23,330 crore, an increase of 9.9% from Rs 21,231 crore in 30 June 2019. Net worth stood at Rs 5,722 crore in 30 June 2020 as against Rs 5,413 crore in 31 March 2020, a growth of 5.7%. SBI Card said Accounts in moratorium went down to 1.5 lakh in June 2020 from 12.5 lakh in May 2020.

On the asset quality front, the gross non-performing assets were at 1.35% of gross advances as on 30 June 2020 as against 2.68% as on 30 June 2019. The Provision Coverage Ratio stood at 68.25% as of 30 June 2020 as against 72% as of 30 June 2019. The capital adequacy ratio improved to 24.4% in Q1 June 2020 from 18.9% in Q1 June 2019.

The companys card-in-force grew by 20% to 1.06 crore in Q1 June 2020 from 0.88 crore as of Q1 June 2019. Spends were at Rs 19,085 crore in Q1 June 2020 versus Rs 30,174 crore in Q1 June 2019. Daily average spends improved to 76.5% of pre-COVID level for June 2020 versus 54% in May 2020. Accounts in moratorium went down to 1.5 lakh in June 2020 over 12.5 lakh in May 2020.

SBI Cards and Payment Services is a non-banking financial company (NBFC) that offer extensive credit card portfolio to individual cardholders and corporate clients which includes lifestyle, rewards, travel & fuel and banking partnerships cards along with corporate cards covering all major cardholders segments in terms of income profile and lifestyle.

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