
Result date: 3rd February, 2023
Recommendation: Buy
Target price: Rs 750
State Bank of India (SBI) is likely to post loan growth of 19% over the year-ago quarter and ~3.6% sequentially, believe analysts at IIFL Securities. They expect 21% year-on-year growth in Net Interest Income (NII) of the bank.
SBI should post sequential improvement in Net Interest Margins. Pre-provisioning Operating Profit (PPOP) is likely to grow 19% over the year-ago quarter, reflecting strong NII growth.
Slippages ratio in the quarter should remain <1% annualized, and analysts at IIFL Securities build in credit cost of ~0.5% on an annualized basis.
Profit After Tax (PAT) could grow 60%, partly due to halving of provisions over the year-ago quarter.
Important management insights to watch out for:
Rs Billion | December 2022 estimates | YoY change | QoQ change |
Net Interest Income (NII) | 372.1 | 21% | 6% |
Total Income | 468.9 | 19% | 6% |
PPOP | 220.0 | 19% | 4% |
Provisions | 35.2 | (50)% | 16% |
Profit After Tax | 134.7 | 60% | 2% |
Source: IIFL Research
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