Q1FY23 Preview: SBI: NII seen at Rs323.1 billion; PAT at Rs107.8 billion

5 Aug 2022 , 02:54 PM

Result Date: 6th August
Recommendation: Buy
Target Price: Rs620

State Bank of India (SBI) could post a moderate Q-o-Q loan growth of 2% for the June 2022 quarter. As compared to the year-ago quarter, loans could grow ~15%. Net Interest Income (NII) growth is pegged at 17% over the year-ago quarter and 4% sequentially. 

Net Interest Margin is expected to remain stable at around 3.15%. Non-interest income is expected to be lower in the quarter. This would cause Pre-Provisioning operating Profit or PPoP to remain flat sequentially. It is forecasted that slippages will remain in control, aiding overall asset quality of the bank.

Lower provisions could aid Profit After Tax (PAT) which is forecasted to grow by 66% over the year-ago quarter.

Key management insights to look into:

• Trends in credit demand across segments, markets
• Details on fee income, treasury income
• Outlook on margin, asset quality

Rs. billion	June 2022 estimate	Y-o-Y	Q-o-Q
NII	323.1	17%	4%
Total income	415.5	5%	(4)%
PPOP	199.4	5%	1%
PAT	107.8	66%	18%

Source: IIFL Research