State Bank of India Q3FY22 Preview: NII seen at Rs 297.5 billion, PAT at Rs 80.3 billion

4 Feb 2022 , 12:20 PM

Result date: 5^th February, 2022
Recommendation: Buy
Target price: Rs. 630                                                              

Country’s largest bank — State Bank of India (SBI) could post 6% YoY growth in its loan book. Deposits are estimated to grow 11% on a YoY basis during the quarter. Net interest margins should remain in the narrow band of 3.2%-3.3% during the quarter. Sequentially, the bank’s operating expense is likely to fall sharply due to lack of provisioning towards family pension which was completed in Q3FY22. However, lower growth in NII and total income could keep pre-provisioning operating profit flat as compared to the year ago quarter.
SBI is likely to post decent performance on asset quality and keep a check on its slippages. Lower credit costs are likely to drive PAT growth during the quarter. PAT could jump 55% on a YoY basis.

Important management insights to watch out for:

• Outlook on credit growth across segments
• Broad trends in asset quality

 

Rs. Billion	December 2021 estimates	YoY change	QoQ change
NII	297.5	3%	(5%)
Total Income	393.0	3%	0%
PPOP	174.0	0%	63%
PBT	110.0	57%	5%
PAT	80.3	55%	5%

Source: Company, IIFL Research