Investors of State Bank of India (SBIN) have a fabulous rally last week. Stock has jumped nearly 40% in the first week of February 2021. As per the results, total deposits grew at 13.64 percent YoY, out of which current account deposit grew by 11.33% YoY, while saving bank deposits rose by 15.99 percent YoY. SBI reported a 6.9% year-on-year decline in standalone profit at Rs 5,196.22 crore for the quarter ended December 2020. Net interest income, the difference between interest earned and interest expended, grew by 3.7% YoY to Rs 28,819.94 crore in Q3FY21.

SBI has been a consistent performer, and is now gaining market share as well, now with benefit of a clean books at FY22E. Given its stronger deposit franchise, downside support from subsidiaries, and low risk of dilution as compared to PSU bank peers, we believe that there are several factors to aid to re-rating of the stock. We believe that the bank has less residual stress from the legacy book; and considering the 9M FY2021 perfromance so far, we believe SBI is likely to undershoot its credit cost guidance for FY2021E. We have revised our estimates and target multiples considering the improved outlook. We maintain a Buy rating on the stock with a revised SOTP-based price target of Rs 460.


Analyst Mohalla has come up with an informative tweet by consolidating the Q3 press conference details as below

CLSA published its research report with a price target of Rs 560 as the asset quality of SBI has improved on a considerable note.

Meanwhile Kotak compared SBIN with Andre Agassi with a thought provoking write up as below

What do you think?? Do you believe that worst is behind SBI and it will march ahead to Rs.1000 level in next 5 years??

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