Tag: SBI

SBI shares surge as bank reports record quarterly profit: Is it time to buy?

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

The shares of State Bank of India (SBI) on Friday (May 10) rose over 1% following the announcement of its robust fourth-quarter results for the financial year 2023-24. The bank reported its highest-ever quarterly net profit of ₹20,698 crore for the fourth quarter.

The lender’s net profit posted a 24% surge compared to the same period last year.

Analysts’ projections, as per CNBC-TV18’s earlier poll, had suggested a contrasting scenario with an anticipated decline of 21.6%.

The actual profit not only surpassed expectations but exceeded them by over 20%.

Key metrics further underlined the bank’s robust performance.

SBI’s Net Interest Income (NII) stood at ₹41,656 crore, surpassing CNBC-TV18’s poll expectation of ₹40,887.5 crore.

Additionally, the lender exhibited its strongest asset quality in nine years, with a notable decrease in Gross Non-Performing Assets (NPA) by 2.9% and Net NPA by 6.1% quarter-on-quarter.

In light of this result, several brokerage firms have expressed bullish sentiments towards SBI’s stock.

Emkay Global retained a ‘buy’ rating on the stock and raised its SBI share price target to ₹950 apiece, citing a strong all-around performance in the fourth quarter.

Motilal Oswal maintained its ‘buy’ call on SBI, emphasising steady growth in revenues and robust asset quality, while projecting promising Return on Assets (RoA) and Return on Equity (RoE) figures for the future.

Nomura highlighted SBI as its top pick and raised its price target on the lender to ₹1,000.

Similarly, Kotak Institutional Equities revised its price target to ₹950, anticipating a relatively stable performance from SBI amid a favourable macroeconomic environment.

Jefferies maintained its ‘buy’ rating on the stock and raised its price target, indicating sustained confidence in SBI’s long-term growth prospects.

Despite the optimistic outlook, some analysts urge caution, noting that while SBI remains a top pick, sharp outperformance from current levels may not be imminent.

At the time of writing this report, SBI shares were trading 0.62% higher at ₹824.70 apiece on BSE.

ALSO READ | Interview: SBI has ₹4 lakh crore worth of loan proposals in pipeline, says Chairman Dinesh Khara

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Interview: SBI has ₹4 lakh crore worth of loan proposals in pipeline, says Chairman Dinesh Khara

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

The State Bank of India (SBI) announced its financial results for the fourth quarter on Thursday, May 9. The state-owned lender’s profits rose by 24% over the previous year, far above street estimates.

Net interest income (NII) inched up by more than 3% year-on-year, while asset quality improved, and advances in deposit growth were positive as well.

Speaking to CNBC-TV18, Chairman Dinesh Kumar Khara stated he expects growth in advances to continue.

He added that SBI has ₹4 lakh crore worth of loan proposals in the pipeline.

Khara also discussed the bank’s stance on RBI’s draft project financing rules.

Here are the edited excerpts:

Q: SBI’s advances growth looks strong, at 5% sequentially. What target do you have for FY25 considering your pipeline, both in the private and government sectors?

A: We anticipate similar trends in advances growth, around 16%, across corporate, SME, retail, and agriculture sectors. The GDP growth outlook supports this confidence. Capacity utilisation has improved to 35%, and working capital facilities have increased by over 10%. Additionally, our unavailed term loans decreased to about 18%. These factors, coupled with a pipeline of ₹4 lakh crore worth of proposals, indicate promising growth for the current financial year.

Q: Your capital adequacy stands at 14.28%, comfortable for a ₹37 lakh crore book. What growth rates can this level of capital support, and when might you consider raising equity?

A: With our current capital adequacy, we can support a growth of up to 20%, equivalent to ₹7 trillion. However, we’ll monitor capital requirements closely, ensuring our Return on Equity (ROE) exceeds loan book growth. We plan to raise tier-I capital this year and may consider further capital raise if needed, though profit plough-back remains a viable option.

Q: Deposits have grown by over 11% year-on-year this quarter. Do you expect this growth rate to continue?

A: Term deposits grew by about 16%, largely due to increased interest rates introduced in October. We anticipate sustained deposit growth and aim to enhance it further through strategic actions in savings and current accounts.

Q: Despite the size of your book, gross slippage remains relatively low. Where do these slippages originate, and do you foresee improvement in FY25?

A: Slippages mainly stem from agriculture and SME sectors. Of the ₹3,886 crore slippages in the last quarter, we’ve already recovered over ₹886 crore. We aim to maintain tight control on slippages going forward.

Q: You closed the year with recoveries and upgrades exceeding ₹11,400 crores. What are your expectations for FY25, especially regarding recovery from large accounts?

A: FY25 may see a slight reduction in recoveries due to fewer high-value accounts in our NPAs and AUCA book. However, we’ll leverage all resources to maximize recovery efforts.

Q: Considering the current deposit cost plateau, do you foresee maintaining or expanding current margin levels?

A: Market uncertainties necessitate cautious underwriting to ensure asset quality. While I refrain from over-committing, our focus remains on prudent management to sustain or enhance margin levels.

Q: Regarding RBI’s draft proposals on project finances, what impact do you foresee on SBI, especially in terms of additional provisioning?

A: The 5% increase in general provisions, if implemented, will likely be phased over three years, providing adequate adjustment time. While the discussion is ongoing, we’re not overly concerned about its impact.

Q: Some stakeholders suggest these guidelines might affect sentiment around project financing. What’s your view on RBI’s approach?

A: Lenders must account for risk premiums adequately to avoid adverse outcomes. Mindful pricing should mitigate concerns surrounding project financing.

Q: You mentioned areas of improvement for SBI. Can you elaborate on these and what to expect for FY25?

A: Efforts to strengthen the CASA ratio are underway, focusing on supporting savings and current accounts. Initial progress is promising, and we aim to harness the collective energy of our branch network to drive deposit growth.

ALSO READ | SBI share price can go up to ₹1,000, say analysts post Q4 results

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

SBI stuns street with record profit and best asset quality in nine years

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

State Bank of India (SBI), India’s largest lender, has announced a 24% increase in net profit for the fourth quarter ended on March 31, 2024. The bank’s net profit soared to ₹20,698 crore buoyed by robust demand for loans.

CNBC-TV18’s earlier poll had suggested a decline in net profit by 21.6%.

Analysts were surprised as the actual profit not only defied projections but also surged by over 20%.

Of notable significance, SBI showcased its strongest asset quality in nine years,

The lender’s Net Interest Income (NII) stood at ₹41,656 crore, exceeding CNBC-TV18’s poll expectation of ₹40,887.5 crore.

In the same quarter of the last financial year, SBI had reported NII at ₹40,392.5 crore.

Furthermore, SBI’s gross non-performing asset (GNPA) reduced to 2.24% from 2.78% last year, and net NPA declined to 0.57% from 0.67%.

SBI’s loan growth remained robust during the March quarter, marking one of the strongest performances in over eight quarters.

The bank’s interest earned surged by nearly 20% to ₹1.11 lakh crore in the reported quarter compared to ₹92,951 crore a year ago.

In a move to reward its shareholders, SBI declared a dividend of ₹13.70 per share.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

SBI Q4 results preview: Net profit may decline by over 20% but analysts optimistic on asset quality

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

State Bank of India (SBI) will announce its results for the fourth quarter of financial year 2024 on Thursday (May 9). According to a poll conducted by CNBC-TV18, the net profit of the bank may experience a decline of 21.6% compared to the same period last year.

Although there could be an increase of 42.8% in net profit when compared quarter-on-quarter (QoQ), the poll said.

Key financial indicators suggest that while the Net Interest Income (NII) is expected to see a rise to ₹40,887.5 crore from the previous quarter and a slight increase compared to the same period last year, Profit After Tax (PAT) is projected to decrease year-on-year to ₹13,081.9 crore.

Several critical aspects of the bank’s performance will be closely monitored.

These include the anticipation that deposit growth may trail behind system growth, while advances growth is expected to maintain its strength.

Analysts predict that Net Interest Margin (NIM) may face pressure both year-on-year and quarter-on-quarter, and operating expenses are likely to remain high, potentially affecting operating profits.

Stable slippages are predicted quarter-on-quarter, while recovery and upgrades are forecasted to be subdued.

Asset quality is expected to either stabilise or improve.

Management commentary on growth, unsecured loans, and NIM outlook will be closely scrutinised.

Analysts at Motilal Oswal anticipate a positive trend for gross non-performing assets (NPAs), predicting an improvement to 2.3% in Q4FY24 from 2.8% in Q3FY24.

Similarly, a decrease in net NPAs is expected to 0.6% in Q4FY24 from 0.7% in the year-ago period.

Throughout the year, SBI shares have seen a growth of over 27% and have outperformed the Nifty 50 index, which recorded only marginal gains of 2%.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

IBA chief weighs in on RBI’s new stricter rules for project financing

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

Sunil Mehta, Chief Executive of the Indian Banks’ Association (IBA) believes the tightening of project financing norms by the Reserve Bank of India (RBI) will bring in financial discipline not only in the banking system but also for infrastructure and construction companies.

RBI is incentivising the timely completion of projects with these guidelines, and Mehta thinks this will make project financing more prudent.

“This provision is providing the cushion to absorb the shocks in case they occur,” he said.

The draft rules issued by the central bank on May 3 include a classification of projects as per their phase and higher provisioning of up to 5% during the construction phase, even if the asset is standard from 0.4% now.

Banks will also have to assess the value of the project every year, even during the construction phase. If it so happens that there’s a change to the projected cash flows, the estimated life of the project (say, a flyover, for instance) or any other such factor, the lender has to make necessary provisions

Mehta pointed out that bankers have learnt infrastructure financing problems the hard way and that is why the Reserve Bank of India (RBI) has proposed to tighten the rules governing project financing.

“There was a time when they (financial institutions) were aggressively lending to the infrastructure sector. Some of the projects could not succeed because the land acquisition could not take place or necessary clearances from the government took longer than expected time,” he said.

Shares of REC, PFC and other state-owned lenders including State Bank of India (SBI), Punjab National Bank (PNB), Canara Bank, Union Bank of India, Maharashtra Bank and Bank of Baroda (BoB), tumbled in trade following the revised draft.

CNBC-TV18 learns that lenders are likely to push back on the proposal.

The central bank’s guidelines are proposed to be applicable on both banks as well as non-bank lenders.

For more, watch the accompanying video

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Planning to buy a car this Akshaya Tritiya? Check which bank is offering lowest interest rate

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

As Akshaya Tritiya, the auspicious occasion believed to bring prosperity and success, approaches on May 10 this year, the automotive industry gears up for a surge in sales. Traditionally associated with purchasing gold, this festival has also become synonymous with acquiring new assets, including vehicles like cars and bikes.

In anticipation of this festive period, banks generally come out with offers on car loans to attract consumers looking to make a big-ticket purchase.

Among the banks vying for attention with competitive interest rates are Union Bank of India, State Bank of India, and ICICI Bank.

According to data compiled by Bankbazaar.com, these banks are currently offering car loans of ₹10 lakh for a duration of four years at interest rates ranging from 8.70% to 9.10%.

Union Bank of India is currently offering interest rate of 8.70%, translating to an EMI of ₹24,565 on the same.

State Bank of India (SBI), the largest bank in India, follows closely with an interest rate of 8.75%, along with other major players like Punjab National Bank (PNB), Canara Bank, and Indian Bank, offering the same rate.

The EMI for loans from these banks amounts to ₹24,587.

Bank of India (BOI) offers an interest rate of 8.85%, resulting in an EMI of ₹24,632 for a four-year car loan of ₹10 lakh.

Meanwhile, Bank of Baroda (BOB), a government-owned bank, extends car loans at an interest rate of 8.90%, with an EMI of ₹24,655.

Moving towards the private sector, ICICI Bank offers car loans at a slightly higher interest rate of 9.10%, translating to an EMI of ₹24,745.

Axis Bank follows suit with an interest rate of 9.30%, resulting in an EMI of ₹24,835.

HDFC Bank, another major player, offers car loans at 9.40% interest, with an EMI of ₹24,881.

It’s important to note that the interest rates mentioned here are indicative and subject to change based on the banks’ terms and conditions.

The data was collected by CNBC Awaaz from the banks’ websites on April 23.

The calculation of the EMI is based on a loan amount of ₹10 lakh with a four-year tenure and assumes zero processing and other charges.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Market valuation of six most valued firms rises ₹1.30 lakh crore

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

The combined market valuation of six of the top-10 most valued firms increased ₹1,30,734.57 crore last week, with State Bank of India and ICICI Bank emerging as the biggest gainers in line with an overall positive trend in equities.

Last week, the BSE benchmark advanced 641.83 points or 0.87%.

The valuation of the State Bank of India rallied ₹45,158.54 crore to ₹7,15,218.40 crore.

ICICI Bank’s market valuation rose ₹28,726.33 crore to ₹7,77,750.22 crore.

Bharti Airtel added ₹20,747.99 crore to ₹7,51,406.35 crore, and that of ITC jumped ₹18,914.35 crore to ₹5,49,265.32 crore.

The market capitalisation (mcap) of Life Insurance Corporation of India (LIC) advanced by ₹9,487.5 crore to ₹6,24,941.40 crore, and that of Infosys went up by ₹7,699.86 crore to ₹5,93,636.31 crore.

However, the mcap of Reliance Industries declined by ₹26,115.56 crore to ₹19,64,079.96 crore.

The valuation of HDFC Bank dipped by ₹16,371.34 crore to ₹11,46,943.59 crore.

The mcap of Tata Consultancy Services went lower by ₹5,282.41 crore to ₹13,79,522.50 crore, and that of Hindustan Unilever Limited diminished by ₹2,525.81 crore to ₹5,21,961.70 crore.

Reliance Industries remained the most valued firm from the top-10 pack, followed by Tata Consultancy Services, HDFC Bank, ICICI Bank, Bharti Airtel, State Bank of India, LIC, Infosys, ITC and Hindustan Unilever.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Once Nifty crosses 22,500 and 22,800, we can see a 5-6% upmove, says Gautam Shah

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

If the Nifty 50 crosses the crucial thresholds of 22,500 and 22,800, investors can expect a significant uptrend ranging between 5% and 6%, Gautam Shah, founder and chief strategist at Goldilocks Premium Research, told CNBC-TV18 recently.

“However, the trade is not about the Nifty and the Bank Nifty. Stay with the outperforming sectors, there is still a lot of money to be made,” he added.

He believes the index is safe till it is above 22,800 and the long-term investors should look at this market and stay with it going forward.

Commenting on the prevailing market sentiment, Shah emphasised that this is a bull market where over-analysis may not be necessary. Instead, he recommended investors to remain steadfast in their positions and refrain from making impulsive decisions. “It is a bull market where you don’t need to overanalyse. I think you just need to say in the bus and not think about getting off on every single correction that happens from time-to-time,” Shah said.

Also Read | Secret to succeed in stock market — Ambit Group CEO Ashok Wadhwa reveals key factors

According to him, general elections 2024 in some sense is a non-event. “In that sense, I don’t think the market is very excited or worried about it,” he said.

He believes, the big trigger for market is going to be earnings and whether the Indian market can deliver on the fundamentals.

Shah further expressed confidence in State Bank of India (SBI) within the public sector undertaking (PSU) banking segment and ICICI Bank among private banks.

Moreover, Shah identified the metal index as the trade of the year. He believes it is set for another 10-15% upside.

Other high conviction idea that he has is chemicals. “SRF, Tata Chemical, Deepak Nitrite, Aarti Industries are all very good stories coming out of two to two and a half years of consolidation,” he said.

Metals, chemicals, pharmaceuticals and select banks and select PSUs are the spaces that he likes.

In particular, Shah expressed optimism regarding the chemicals sector, noting that the uptrend observed since 2020 has resumed. This resurgence in the chemicals industry indicates promising prospects for investors seeking growth opportunities in the market.

“All the top quality stocks in chemicals should do well over the next 6-12 months,” he said.

From auto sector, he likes Eicher Motors and Escorts Kubota.

“These two stocks could do special things along with Maruti Suzuki,” he said.

He believes these three names could generate alpha for investors over the next 6-12 months.

For more, watch the accompanying video

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

FSIB recommends Rana Ashutosh Kumar Singh for managing director role at SBI

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

The Financial Services Institutions Bureau (FSIB) has recommended Rana Ashutosh Kumar Singh for the role of Managing Director (MD) at the State Bank of India (SBI), according to an announcement made on Wednesday, April 24.

“After conducting interviews with 16 candidates on April 23 and April 24 for the MD position at SBI, and considering their performance, overall experience, and existing criteria, the bureau has endorsed Kumar’s candidacy for the MD role,” stated FSIB.

Furthermore, FSIB has put forth Asheesh Pandey’s name for the position of Managing Director and Chief Executive Officer (MD & CEO) at Indian Bank.

The final decision on these recommendations from FSIB will be made by the Appointments Committee of the Cabinet, chaired by Prime Minister Narendra Modi.

Rana Ashutosh Kumar Singh previously served as the Deputy Managing Director (Retail – Personal Banking & Real Estate) at SBI, having commenced his journey with the bank as a probationary officer on August 1, 1991. Over a span of 32 years, Singh has held diverse roles across various locations within the bank.

Throughout his career, Singh has played pivotal roles in retail banking, credit, human resources, and international banking. In addition to his responsibilities in India, he has served as the CEO of the Frankfurt Branch in Germany.

Singh is a Certified Associate of the Indian Institute of Bankers and holds an MBA (PGEMP) from the S.P. Jain Institute of Management & Research in Mumbai. He has further honed his leadership skills and knowledge through participation in Leadership Development Programmes at esteemed institutions such as Harvard Business School, Indian School of Business in Hyderabad, and Stanford Graduate Business School.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

SBI NCMC cards now available on Bharat BillPay platform: Here’s how to recharge

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

Listen to the Article (6 Minutes)

NPCI Bharat BillPay Limited (NBBL), a subsidiary of the National Payments Corporation of India (NPCI), has collaborated with the State Bank of India (SBI) to onboard SBI NCMC cards on its Bharat BillPay platform. This partnership aims to streamline the recharge process for National Common Mobility Cards (NCMC).

The category is already live with SBI NCMC cards for Noida Metro, Nagpur Metro, MMRDA Line 2A & 7, Chennai Metro, Kanpur Metro, and Parliament Canteen via the bank’s Bharat BillPay-enabled application, SBI Unipay, and more frontend platforms will go live with the service soon, NBBL said in a statement.

This new feature will enable customers to recharge or top-up their NCMC cards online.

Commuters will be able recharge their NCMC cards with amounts up to ₹10,000 using various payment methods, including prepaid, debit, and credit cards.

Noopur Chaturvedi, CEO of NPCI Bharat BillPay said, “NCMC customers, across locations, can now get a seamless experience while recharging, at the platform of their choice. This is one more step to ease digital payments, backed by the certainty, reliability, and safety of our Bharat BillPay platform.”

Mahesh Kumar Sharma, DMD (Transaction Banking & New Initiatives) at State Bank of India said, “Through this development, SBI NCMC cardholders can get  instant and secure option of topping up their wallets via SBI Unipay and all other Bharat BillPay-enabled digital front-end platforms.”

To recharge their NCMC cards via Bharat BillPay, customers can follow these steps:

Step 1: Open SBI Unipay (or other Bharat BillPay enabled front-end platforms)

Step 2: Choose the NCMC category

Step 3: Select the biller

Step 4: Input mobile number and last 4 digits of NCMC card number

Step 5: Enter the recharge amount

Step 6: Make the payment

Upon successful recharge, customers need only tap their cards on terminals to update the balance on their NCMC cards.

Elon Musk forms several ‘X Holdings’ companies to fund potential Twitter buyout

3 Mins Read

Thursday’s filing dispelled some doubts, though Musk still has work to do. He and his advisers will spend the coming days vetting potential investors for the equity portion of his offer, according to people familiar with the matter

KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow