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Q4FY23 Preview: State Bank of India: NII seen at Rs. 39,856 crore, PAT at Rs. 14,774 crore

16 May 2023 , 12:27 PM

Result date: 18th May, 2023

Recommendation: Buy

Target price: Rs. 700

(Source: IIFL Research)

Country’s apex bank, State Bank of India (SBI) could post ~28% growth in its Net Interest Income (NII) over the year-ago quarter. Healthy momentum in advances (up 16% year-on-year) will be a key driver of NII. While retail loans remain on a strong footing, pick up in credit demand from SMEs and Corporates could further support loan growth.

SBI’s net interest margin could inch up by a few basis points amid rising deposit costs and relatively faster repricing of loans. Pre-provisioning operating profit could increase 29% over the year-ago quarter on the back of flattish opex ratios.

The bank has witnessed continued improvement in asset quality and the trend is likely to continue in the March 2023 quarter as well. Credit costs too are expected to remain stable. Improved underwriting and significant mobilization in customer engagement by the recovery team has aided SBI’s asset quality performance. Fresh slippages have also moderated, beating private peers. 

SBI’s Profit After Tax (PAT) could surge 62.1% over the year-ago quarter.

Important management insights to watch out for:

  • Traction in loan book across key segments, markets
  • Outlook on asset quality
  • Growth in deposits
Rs. Crore

March 2023 estimates

YoY change

QoQ change

Net Interest Income

39,856

27.7%

4.7%

Pre Provisioning Operating Profit

25,452

29.1%

0.9%

Profit After Tax 

14,774

62.1%

4.0%

Source: Brokerage Reports

Related Tags

  • sbi
  • SBI Q4
  • State Bank of India
  • State Bank of India Q4
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