InvestorQ : How did you see the SBI stock after the Q3 results announced on Saturday?
Debbie Mascarenhas made post

How did you see the SBI stock after the Q3 results announced on Saturday?

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Arti Chavan answered.
3 months ago
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For the Dec-21 quarter, SBI reported 7.6% growth in revenues at Rs.104,528 crore on a yoy consolidated basis. If you look at the revenues on a sequential basis, it was up 3.55%. Among the key verticals, SBI saw modest revenue growth in treasury operations and retail banking but a modest fall in revenues in wholesale banking. Insurance revenues from the SBI Life subsidiary was up 27% yoy.

The important net interest income or NII for SBI was up 6.48% at Rs.30,687 crore. The ratio of CASA deposits stood at 45.74% in the case of SBI. Overall domestic advances grew 6.47% in Q3 but retail advances grew 14.6%, as is the general trend. Net interest margins improved by 6 bps yoy at 3.40%. Overall, the stock of SBI appears to be discounting the earnings at a reasonable price, all the more so after the improvement in numbers in this quarter.

State Bank of India

Rs in Crore

Dec-21

Dec-20

YOY

Sep-21

QOQ

Total Income

₹ 1,04,528

₹ 97,182

7.56%

₹ 1,01,143

3.35%

Operating Profit

₹ 20,592

₹ 19,417

6.05%

₹ 20,445

0.72%

Net Profit

₹ 9,555

₹ 6,258

52.70%

₹ 8,890

7.48%

Diluted EPS

₹ 10.71

₹ 7.01

₹ 9.96

Operating Margins

19.70%

19.98%

20.21%

Net Margins

9.14%

6.44%

8.79%

Gross NPA Ratio

4.50%

4.77%

4.90%

Net NPA Ratio

1.34%

1.23%

1.52%

Return on Assets (Ann)

0.71%

0.49%

0.66%

Capital Adequacy

13.23%

14.50%

13.35%

Operating profits of SBI for the Dec-21 quarter were up 6.05% at Rs.20,592 crore. Credit costs stood at just 0.49% while cost to income (C/I) ratio trended lower at 52.94%. SBI improved its ROE by 452 basis points to 14.01%. Provision coverage ratio stood at 88.32% in the quarter with slippage ratio at about 0.37%. Operating margin or OPM tapered slightly from a level of 19.98% in Dec-20 to 19.70% in Dec-21 quarter.

Net profits were up 52.7% at Rs.9,555 crore largely on account of a 31% fall in provisions for loan losses at Rs.7,442 crore. Gross NPAs are now largely under control at 4.50% and that makes a case for a serious relook at SBI at these levels. The one area that needs attention is the Capital adequacy which is low at 13.23%. PAT margins improved sharply from 6.44% to 9.14% on a yoy basis in the Dec-21 quarter.

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