Buy or Sell SBI : After the quarterly results, the shares of the country’s largest public sector bank SBI are seeing a rise today. Today the share increased to Rs 832 (SBI Stock PriceReached which closed at Rs 819 on Thursday. Rs 840 for the share is a one year high. The consolidated net profit of the bank has increased by about 18 percent for the quarter ending March 31, 2024, while the company’s profit on a standalone basis has increased by about 24 percent. During this period the total income has increased by about 28 percent. After the results, leading brokerage houses are positive about this banking share and are advising to invest in it.
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Rating and target price on the stock
Antique Broking
Rating: BUY
Target price: Rs 900
Motilal Oswal
Rating: BUY
Target price: Rs 925
Nirmal Bang
Rating: BUY
Target price: Rs 1003
Nomura
Rating: BUY
Target price: Rs 1000
DAM
Rating: BUY
Target price: Rs 910
ICICI Securities
Rating: BUY
Target price: Rs 980
Kotak Securities
Rating: BUY
Target price: Rs 950
HSBC
Rating: Hold
Target price: Rs 950
Incred
Rating: Hold
Target price: Rs 1000
Citi
Rating: Sell
Target price: Rs 701
Jefferies
Rating: Sell
Target price: Rs 810
Bernsteinon
Rating: Market perform
Target price: Rs 780
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What does the brokerage house have to say?
Brokerage house Motilal Oswal says that SBI has registered a stable quarter with stable growth in revenue. While strong asset quality helped the bank maintain strong control over provisioning expenses. Operating expenses remained low as the bank benefited from lower wage expenses. Which resulted in healthy PPOP growth. Margin in 4Q increased by 8bp on quarterly basis to 3.3 percent. However, the bank expects the margins to remain broadly stable going forward with factors like CD ratio and MCLR repricing. Business growth remained strong with healthy recovery in the corporate sector.
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The brokerage expects credit growth to be in the range of 13-15 percent. Asset quality remained good due to improvement in GNPA ratio and reduction in slippages. The restructured book is well managed at 0.5% advance. The brokerage estimates that SBI will deliver RoA/RoE of 1.1%, 18.5% in FY26. The brokerage has maintained its buy rating with a target price of Rs 925.
Brokerage house Nirmal Bang says that SBI’s PAT has improved in 4QFY24. PAT increased by 125.9% on quarterly basis to Rs 20700 crore in 3QFY24 due to base effect of wage revision and pension provisions. Loan growth increased from 15.1% y-o-y in 3QFY24 to 15.8% y-o-y in 4QFY24. Asset quality also improved, with GNPA reducing to 2.24% in 4QFY24 from 2.42% in the previous quarter. Credit cost for FY24 remained at a low of 0.29%. The brokerage estimates SBI’s PAT to grow at 16.6% CAGR during FY24-FY26E, supported by 15.2% CAGR in loan growth, stable margins, improved cost ratios and credit cost of 50bps. This will take RoA/RoE to 1.1%/17.8% in FY26E.
(Disclaimer: The advice for investing or selling stocks has been given by experts and brokerage houses. These are not the personal views of Financial Express. There are risks in the market, so take expert opinion before investing.)
